SHANGHAI, Jan. 14 (SMM) – LME nickel prices have been falling for one month since Dec. 5, 2014. Markets earlier expect nickel prices to surge with the arrival of monsoon season in the Philippines.
Market expectations, however, did not materialize. Why?
High inventories are blamed for weak prices, Shanghai Securities News cited industry source as saying.
LME nickel inventories ballooned up to 415,000 tonnes, up 54% from 270,000 tonnes last March, according to latest industry data.
The supply volumes of low and medium-grade nickel ore from the Philippines also far exceeded earlier market estimate.
However, nickel ore inventories at China’s major ports have been falling since the beginning of monsoon season in the Philippines, which becomes the largest nickel ore supplier since Indonesia’s export ban on unprocessed ores in earlier 2014.
Nickel ore inventories at China’s five major ports fell to 13.33 million tonnes in the week ending Jan. 9, down for eight consecutive weeks, SMM data show.
Nickel prices, as a whole, will gain a rising support from market fundamentals in 2015, said an analyst from Baosteel Resources.