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BloombergBusiness reported that on Monday, London Metal Exchange nickel rose as much as 2.1 percent. The rise came as China announced plans for more stimulus.
BloombergBusiness reported that on Monday, London Metal Exchange (LME) nickel rose as much as 2.1 percent. The rise came as China announced plans for more stimulus.
Unfortunately, the base metal is still down 29 percent so far in 2015, and that could have wide-reaching consequences. The news outlet states:
Global nickel output is likely to fall as some producers hit a “pain threshold” on lower prices, Dan Lougher, the chief executive officer of Western Areas Ltd., said in an interview on Tuesday. Standard Chartered Plc estimates as much as 65 percent of production is unprofitable at current trading levels.
Mike Dragosits, a senior commodity strategist at TD Securities in Toronto, commented:
China is on this big infrastructure spending campaign. The more news we get of this stimulus, the quicker we could put in a bottom in these base metals.
Prices of nickel have cut into the cost curve for a while now. It’s not surprising that producers would start suggesting they’re going to have to cut production here and there.