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2019 a Staller Year for Nickel, 2020 Uncertain as Indonesia Ore Ban Looms

Metal News - Published on Wed, 11 Dec 2019

Image Source: Nickel Prices
2019 has proved to be a landmark year for nickel, which rose by whooping 77% in first 9 months on supply fears to USD 18850 per tonne on London Metal Exchange related to an export ban from the world's number one producing nation Indonesia, has fallen from grace in recent weeks to dip to USD 13195 on December 9th, down by about 30% as Indonesian ban then seemed to be less of a concern than poor demand. Various analysts are busy adjusting their outlook for nickel

Bank of America analyst said “Many of the usual metrics, including canceled warrants and forward curves have now been normalizing, as prices dropped by 30%, suggesting the nickel market can now refocus on fundamentals. One of those fundamentals is growing demand from the electric vehicle sector. We have been long-term nickel bulls on a view that the electrification of autos would boost battery demand and push up nickel usage along with it.”

Citi analyst aid "Current nickel prices are digging into marginal production costs and in our view pricing a recession like demand outlook We are bullish nickel on a 6-12 month view and recommend scaling in from around current levels. We see the risks surrounding the price outlook as skewed to the upside by around 3:1 at USD 14,000, USD 13,000 near-term downside risk vs a USD 17,500 2020 point price target.”

Capital Economics analyst said “Given the Indonesian export ban from January, there’s probably scope for the price to move higher next year. But there’s a bit of a wild card to the extent to which there are stocks left off the official numbers. Our estimates are that there’s about 300,000 tonnes of unreported nickel sitting off exchange.”

LME Cash
DatePrice
1-Jan10640
1-Feb12375
1-Mar12875
1-Apr13010
1-May12355
1-Jun11975
1-Jul12660
1-Aug14355
1-Sep18850
1-Oct17560
1-Nov16830
9-Dec13196
 

In USD per tonne

Source :

Posted By : Yogender Pancholi on Wed, 11 Dec 2019
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