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Reuters reported that while the nickel price’s precipitous fall may have come to a brief halt, it’s possible that the reprieve will be brief.
Reuters reported that while the nickel price’s precipitous fall may have come to a brief halt, it’s possible that the reprieve will be brief. According to the news outlet, “significant, enduring cuts and stronger demand from China’s stainless steel mills” will be required for a true price recovery.
As quoted in the market news:
Speculation that miner and trader Glencore, the world’s fifth-largest producer of nickel, would cut output helped buoy prices last month. But the optimism was short-lived.
“The problem is how permanent are the cuts, will that supply come back to the market at a later stage if prices recover and are they going to be offset by worsening demand,” said Edward Meir, analyst at INTL FCStone.
“That’s the quandary; the market is very sceptical, and so we could have a prolonged period of prices bumping along the bottom until we get a better handle as to what is going on.”
Chinese nickel producers said on Friday they were planning to cut 15 000 t of refined metal and nickel pig-iron, a cheaper alternative, next month. They are also planning to cut output by 20% next year.