SMM & ICBC Metals Seminar: Demand from new-energy to support nickel prices

LONDON, Oct 9 (SMM) – Consumption of nickel in China's new-energy battery sector is expected to gain 18,000 mt in 2019, to stand at 65,000 mt, and this will support nickel prices, said Yang Bo, SMM senior analyst.

Demand from the sector will continue to grow after 2020, she told delegates at SMM & ICBC Standard Bank London Metals Seminar on October 9, jointly organised by the two companies during LME Week. 

She believes that in 2019-2020, the stainless steel sector in Indonesia and China, as well as battery sector in China and western market will account for the majority of primary nickel consumption. 

A shortage of nickel globally will also buoy prices through 2019, and prop up premiums of high-grade nickel pig iron (NPI) over refined nickel, said the analyst. 

The supply shortage is estimated to stand at 77,300 mt this year, with second-grade products such as ferronickel and NPI accounting for the majority. 

In 2019, supply tightness is likely to ease as primary nickel production grow 10% year on year to 2.46 million mt globally. NPI production in China may gain some 40,000 mt from 2018 to 480,000 mt in nickel content next year. She also forecasted that the output of NPI in Indonesia will grow from 140,000 mt this year to 390,000 mt in 2019.

There will be uncertainties from domestic environmental curbs and construction schedules in Indonesia, she added.