Nickel Prices Keep Slumping Even as Mines Close
ca.finance.yahoo.com
Liz Yee Xing Ng and Thomas Biesheuvel
Mon, January 22, 2024 at 3:33 a.m. PST·2 min read
(Bloomberg) -- Nickel continued its slump, heading toward the lowest level in more than three years, even as the collapse in prices for the metal force mines to shutter.
The metal used in stainless steel and electric-vehicle batteries is down more than 40% from a year ago amid a growing global glut. The market has been flooded with a wave of new material from top producer Indonesia at a time when demand growth has faded.
Nickel fell as much as 0.7% to $15,920 a ton on Monday, the lowest since Jan. 5. A close at that level would be the lowest since November 2020.
The impact on the mining industry has been brutal. On Monday, billionaire Andrew Forrest’s nickel producer Wyloo Metals Pty Ltd. said it’s shutting down mines. BHP Group and First Quantum Minerals Ltd. are also being hit, while a raft of smaller producers have been forced to halt construction or fall into administration.
Nickel Price Crash Seen Extending Indonesia’s Grip on Supply
“The pressures in the global nickel market are becoming increasingly apparent,” said Colin Hamilton, managing director for commodities research at BMO Capital Markets Ltd.
“We have noted that further temporary or permanent capacity cuts were required to balance the nickel market following last year’s surplus, but it is yet to be seen whether sufficient adjustment has taken place,” he said.
Inventories of nickel have surged almost 90% since June on the London Metal Exchange, rebounding from a decade-low level.
Iron ore steadied after its first weekly gain in three, with investors focusing on weakness in China’s steel-intensive property sector after the nation’s commercial lenders kept benchmark lending rates unchanged.
Copper slipped 0.2% at $8,333 a ton on the LME, while most other metals also declined. |
