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To: LoneClone who wrote (30610)	1/23/2007 9:47:29 AM
From: LoneClone	Read Replies (1) \| Respond to of 78417

China's Nickel Demand to Remain Strong Amidst High Prices By David Harman 22 Jan 2007 at 08:51 AM EST resourceinvestor.com SHANGHAI (Interfax-China) -- China's demand for nickel might not be hampered by high global prices, some analysts say. "The high international nickel prices partly reflect high demand from the market, especially from China," said analyst Zhu Limin from Shanghai Securities. China's Nickel imports increased by 7.6% to 86,908 tonnes in the first 11 months of 2006 compared to the same period of the previous year, statistics from the National Development and Reform Commission indicate. China accounts for more than 60% of the global demand for nickel. Current global nickel production is about 1.3 million tonnes a year, with two-thirds of the metal being used in stainless steel production, 10% in electroplating, 20% in alloys and coins. China's steel products output reached 425 million tonnes in the first 11 months of 2006, representing a 24.8% increase from a year ago, according to the National Bureau of Statistics. Analysts believed that China's stainless steel output will increase by one third this year from last year's 6 million metric tonnes, with production capacity to hit 10 million tonnes by the end of this year. About two thirds of the nickel was used to produce stainless steel in China. "Nickel shortages and low stockpiles on the world market are pushing prices higher," said Zhu. The nickel stockpile at the London Metals Exchange remained at a record low of 5,178 metric tonnes last Friday, amid annual global consumption of 1.4 million tonnes. The LME price is currently 37,300 per tonne. "Domestic stainless steel prices rose in line with nickel prices, and the sales are still very good, but we will see," said an official from the sales department of Posco Zhang Jiagang Stainless Steel, a major stainless steel producer in China. Commentary Bolstered by China's steel industry, and the necessity to drive high-end finished product exports, demand for nickel will remain robust. Over the longer term, watch to see whether global appetite for China's steel can be sustained. © Interfax-China 2007 This article comes from Interfax China Commodities Daily, a daily digest produced by Interfax News Agency in Mainland China. To receive 5 free copies of this, please e-mail alison.crawford@interfax.co.uk.