SHANGHAI, Dec 7 (SMM) – According to nickel and platinum group metals market report issued by Nornickel, the world’s largest high-grade nickel producer, nickel supply tightened sharply in 2021 due to a series of supply reductions, unusually strong demand recovery caused by logistics restrictions, and restocking by the entire value chain in substantial volume.

Therefore, Nornickel has revised the market supply and demand in 2021. Currently, it is expected that the nickel market will have a short supply of 149,000 mt, while the previous estimate is a surplus of 52,000 mt. This is due to the strong performance of the stainless steel and battery industries, coupled with disturbances caused by COVID pandemic and sluggish operation of NPI capacity in Indonesia.

Nornickel expects that the nickel market will have a surplus of 59,000 mt in 2022, mainly low-grade nickel, while the high-grade nickel market is expected to be balanced, but there is a possibility of shortage.

However, the report suggested that the long-term demand for nickel will benefit from the development of the electric vehicle industry driven by policy stimulus around the world. Nornickel estimates that nickel consumption in the battery sector will increase by more than 1 million mt by 2030, accounting for 30% of the total original nickel demand. It may require further correction amid the continuous introduction of greater carbon neutrality targets, subsidies to drive electrification and cost optimisation for battery production.