Base Metals

Nickel Investing

Jim Lennon, senior consultant at Macquarie, talks about the current state of the nickel market and what’s ahead for the metal.


Despite the slowdown in adoption of high-nickel cathodes in electric vehicle batteries, excitement around long-term nickel demand from the sector continues.

At this year’s Cathodes conference, the Investing News Network sat down with Jim Lennon, senior consultant at Macquarie, to talk about the state of the nickel market and what’s ahead for the metal.

Nickel prices are up almost 50 percent year-to-date, with one of the main drivers being Indonesia’s export ban news.

“(Aside from that) there’s been a massive drawdown of (London Metal Exchange) nickel inventories,” he said. “They were at around 170,000 tonnes in September, now down to around 60,000 tonnes.”

Lennon also talked about what he expects will happen to supply next year, and the impact the Indonesia announcement could have on the market.

Speaking about the role of nickel in batteries, the expert said that in the short run, batteries will only make up 5 to 7 percent of total demand — a very small portion of the market.

“The challenge for the battery industry is to find nickel units that are suitable to make the batteries,” he said. “Virtually all nickel supply growth in the past years has come from nickel pig iron … which is not suitable for the batteries — so the challenge is to compete for the available nickel units.”

Lennon also explained why he believes calling Class 1 nickel or nickel coming from sulfide ores “battery suitable” is a myth, and what factors he will be watching out for next year that could impact the market.

Watch the video above for more of Lennon’s thoughts. You can also click here for more video interviews from Benchmark Minerals Week.

Don’t forget to follow us @INN_Resource for real-time updates!

Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.

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