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In 2016, the market expected a deficit of nickel

31 January 2016

The Japanese company Sumitomo nickel forecasts for the current year of nickel deficiency. Under assumptions of analysts disadvantage will be about 43 000 tonnes. This forecast is higher than the data obtained in October 2015. Then said about 7,000 tonnes of the metal shortage. Representatives of the company believe that the low cost of the metal will cause a decline in production. Small nickel supply in the market will be observed for the first time for the 6-year period. In 2015, there was oversupply of 57 000 tonnes. According to Sumitomo assumptions in the current year is expected to increase demand for nickel. Regarding the 2015 it will be 1.6% to reach 1 million tons mln.934. This reduction in supply will reach 3.6%, which is 1 mln.891 thousand tons. Decrease and production of nickel pig iron in China. The fall will be 21% to 300 000 tons.

In this situation, the Philippine nickel development does not bring benefits. Under adverse weather conditions, the proposal will fall even more. More than 90% of nickel raw materials China receives from the Philippines. For this reason, the Chinese metal production depends on the Philippine production volumes. The Philippines became the leading supplier of nickel after the Indonesian ban. Also suppliers of leaders in 2014, beat out New Caledonia. In December, Global Ferronickel Holdings — Philippine company — announced future plans. It is possible that the management was forced to stop production of raw material in some fields.

Nickel prices on the London Stock Exchange in 2015 showed a significant drop. It was over 40%. By mid-January 2016 prices fell to an extreme level since 2003. Metal cost was 8100 USD / ton. The company believe that nickel prices will not go up without recovery of consumption. Societe Generale believes that the price will rise to 8,500 USD / ton in the year Ikvartale. In II and IIIkvartale value will reach 9000 USD / ton. In IVkvartale price of 9500 USD / ton.

At the beginning of December 2015 the Chinese manufacturers have stated to reduce production output. It was a question of refined nickel and nickel pig iron. In the 8th Company expects to reduce production by 15 000 tonnes. Their total production capacity of around 400 000 tonnes / year. In 2016, production will be reduced by approximately 20% on the results of 2015. It is not excluded and a greater decrease in volume.

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