13 May 2024 – According to a recent correction in the forecast by the International Nickel Study Group (INSG), the global surplus in nickel production will shrink dramatically in 2024, while consumption will at least remain the same. High-quality class 1 nickel in particular is likely to become scarce soon.
Nickel surplus shrinks dramatically
At the end of April 2024, the International Nickel Study Group (INSG) had to revise its surplus forecast from October 2023 downwards by almost 55% in volume. As there were already almost only surpluses of class 2 and nickel chemicals in 2023, the availability of class 1 nickel traded on the LME is likely to remain tight.
Class 1 already in short supply?
The slight increase in LME warehouses since the beginning of 2024 is therefore likely to be due to production in 2023 and has probably peaked. This is because the INSG has only marginally revised consumption for 2024 downwards by less than 1%.
INSG forecasts should be viewed with caution
Overall, the INSG’s forecasts must be viewed with caution, as the countries that finance the INSG can neither be described as objective nor impartial. This can be seen, for example, in the annual ‘An Overview of World Stainless Steel Scrap Trade…’ published in December 2023 for 2022.
Distortions in the EU stainless steel scrap market ignored
The distortions on the European stainless steel scrap market, which showed signs of active price fixing from spring 2022, are not even mentioned in the report.
In 2021, the INSG had already failed to see the deficit of almost 170 kt in nickel availability coming and had instead assumed a surplus.
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