The latest data from the International Nickel Study Group (INSG) shows that global nickel production increased significantly by 22% year-on-year in January this year.
At the current rate, the nickel production of the mine is expected to exceed 3.2 million tons per year. The surge in production is mainly due to the continuous growth of Indonesian production, with a year-on-year growth rate of over 40% in January. The demand for refined nickel in January shrank by 5% month on month and increased by 2% year-on-year. BMO Capital Markets pointed out that the January data corresponds to an annual demand of 2.8 million tons, with an excess consumption of 255000 tons.
Since the beginning of this year, nickel prices have fallen by 28% and closed at $22300 per ton last Thursday. Reuters reported that the difference between spot prices on the London Metal Exchange (LME) and March futures prices is as high as $362 per ton, the highest since December 2007, indicating insufficient demand in the spot market. Key material market intelligence firm PB (Project Blue) stated that trading liquidity should increase during the Asian period, and nickel prices can better reflect market fundamentals. Because in the next three months, nickel prices should gradually return to normal.
