Nickel Market “Staring Contest” Likely to Cause Losses

Reuters reported that because nickel miners are reluctant to curb production, even in the face of oversupply and low prices, more writedowns and losses are likely.

As quoted in the market news:

Between a quarter to a half of the nickel sector could be running at a loss, according to industry estimates, hit by weak demand from China, the world’s top producer and consumer of stainless steel. Nickel is a key component of stainless steel.

Nonetheless, few miners have yet made deep cuts in output and the trend is set to put more pressure on depressed prices.

‘It’s a staring contest, no one wants to be the first to take the pain,’ said Robin Bhar, an analyst at Societe Generale in London.

Click here to read the full Reuters report.