Nickel’s Floor Probably Isn’t $20,000, Macquarie’s Lennon Says

Bloomberg reports that nickel’s price floor probably isn’t $20,000 a metric ton because of nickel pig iron producers.

Macquarie Bank Group’s Global Head of Commodities Research Jim Lennon says,

The idea that $20,000 is some sort of floor on the price through which it cannot penetrate, I think it’s not correct. Sixty percent of the cost of producing nickel pig iron is the nickel ore itself. As the nickel price comes down, the price of the ore comes down as well. At today’s nickel prices, the breakeven may be $20,000. But if the nickel price goes to $20,000, then the breakeven for these facilities comes down to $18,000 to $19,000.

For the complete market news, click here.