The rapid rise in prices for nickel is explained by Haip, associated with electric vehicles, prevent traders and analysts. In the coming years, new sources of supply will appear, so recent growth, in their opinion, may be short-lived.
The price of nickel on the London Stock Exchange of Metals has grown from a March minimum by 70% to $ 18,410 / t last week (now it is slightly exceeded $ 18,000). Speculats made a bet on the growth of metal demand as a result of an increase in electric vehicles, in which batteries with high nickel content are increasingly used. The forecasts of strong growth in sales of electric vehicles due to numerous state programs to ensure green recovery of the economy led to higher prices and other metals used in production, including copper and lithium.
"Rally [in the nickel market] is not connected with fundamental indicators," says Andrew Mitchell, Wood Mackenzie analyst. - It's all about the electric car. If you look at the ratio of supply and suggestions, last year there was a significant surplus. And we expect it to preserve this year, and in the following. "
The global demand for purified nickel from the battery manufacturers is only 8%, and more than two thirds fall on stainless steel. But, according to the assessment of CRU consulting company, the demand for nickel in battery manufacturers can reach 32% by 2040. Such predictions also stimulated the rise of prices.
"Moods have changed much. A significant part of stimulating measures is associated with green energy, from here and all this Haip, "says Rob Craforud, the NCIM portfolio controlling portfolio, which specializes in commodity investments. However, in recent years, significant investments have been made in the expansion of the offer, therefore, refer to the prospects of the market should be careful, warns crafourd. It prefers to invest in copper, because its application area is much wider: it is needed for electrical wiring in various types of equipment related to clean energy (not only in electric vehicles, but also, for example, in wind turbines). In addition, the copper market threatens the proposal shortage.
As for nickel, excess metal is expected to continue thanks to new projects in Indonesia, Africa, Canada and the United States. The largest source of the proposal, apparently, will be the projects supported by China in Indonesia, where it is planned to remove the nickel and cobalt from the ores with acid leaching under high pressure to satisfy the growing demand from the electromotive industry. Production within one of such projects managed by Chinese Ningbo Lygend should begin this year. The start of another, under the guidance of the Chinese manufacturer of materials for GEM batteries, is scheduled for 2022, but much will depend on the situation with the coronavirus pandemic.
According to analysts by Chinese GF Securities, these new projects will "reduce the cost of production with the help of acid leaching under high pressure, which will lead to transformations of the production of batteries using nickel." Energy intensity of batteries with a high content of this metal is higher, which increases the range of electric vehicles.
Talon Metals, which, together with Rio Tinto, develops the nickel field in Minnesota, is aimed at the electric car market; The start of production is scheduled for 2025. And last week, the small British company Kabanga Nickel agreed with the Government of Tanzania on the development of the Kabanga field in the country.
However, problems may arise with the production of nickel. Last year, on the island of New Caledonia (French territory in the southern Pacific) protesters attacked the mine belonging to the Brazilian mining company Vale, after she agreed to sell the asset consortium with the participation of the Swiss raw materials trader Trafigura. In October, in the referendum, residents of New Caledonia refused to declare independence from France, but the attitude of local residents to foreign mining companies deteriorates. This can lead to the closure of the Goro mine and a number of others on the island. "If it continues, it will not be for what. The island is just a powder barrel, "says one of Nickel traders.
In a longer-term perspective, the growth rate of demand from the batteries for electric vehicles remain a major issue. If they are high, the lack of supply may be "quite significant to influence nickel prices for two or three years," says Rachel Zhang, Morgan Stanley analyst.
Craforud also thinks that a significant increase in demand is "a factor of a more distant perspective than the market involves." According to his forecast, an excess of supply will continue at least until 2024, and even until 2025
Translated Mikhail Overchenko