Global Nickel Production to Report Growth For the First Time Since 2013

SEATTLE (Scrap Monster): According to the latest research report published by BMI Research, global refined nickel production is likely to report growth for the first time since 2013. The global refined nickel production will marginally increase from 1.90 million tonnes in 2016 to 1.93 million tonnes in 2017. Also, production will gradually improve to touch 2.06 million tonnes by 2021. However, prices that are likely to remain stable in the near-term, are expected to drop to USD 9,000 per tonne by 2021.

The slight increase in nickel production is mainly driven by the moderation in Indonesia’s mineral export ban, which in turn may boost the export of nickel ore by miners. The refined nickel output from the country is likely to grow by 9.4% during 2017 to 2021. The total production is expected to total 57.0 kt in 2021, as compared with 48.0 kt in 2017. The production jump in Indonesia will lift the overall production outlook in Asian region, the report notes.

The world nickel production is expected to grow by 3.4% per annum until 2021. This production growth is significantly lesser than the 5.3% average growth rate per year reported during the previous five year-period from 2012-’16. Philippines will continue to be the world’s largest nickel producer. However, the country’s global market share will drop significantly due to lack of new projects on account of stringent regulations imposed by Environment Ministry. The nickel output growth will be led by Indonesia, followed by Canada and Australia.

The Chinese nickel production is projected to increase from 206 kt in 2016 to 212 kt in 2017. The country’s nickel output is predicted to grow at the rate of 2.4% per year during 2017-2021. The total production is likely to reach 232 kt by 2021. On the other hand, Russia’s nickel output will decline marginally by 1 kt in 2017, when compared with 2016. The country’s average production growth will stagnate at 0.5% per year during the next five-year period. The country’s share of global production will drop from 13.2% in 2017 to 12.7% in 2021. Meantime, Australian nickel production is forecast to gradually increase from 106 kt in 2016 to 117 kt by 2021. Canada’s production will increase marginally from 133 kt in 2017 to 137 kt in 2021.

According to BMI Research, global nickel consumption will decline by 1.7% year-on-year from 1.97 kt in 2016 to 1.94 kt in 2017. The overall growth will see marginal decline of 0.1% from 2017 to 2021. The consumption will witness marked decline in key Asian markets including China. The rise in nickel pig iron (NPI) demand in the country will result in Chinese consumption falling from 334 kt in 2016 to 322 kt in 2017. Meantime, Japan is likely to witness 1.7% average year-on-year consumption growth during the next five years. The annual average nickel consumption by Taiwan and South Korea is likely to witness 7.0% and 3.6% growth respectively during 2017-’21.

Lastly, nickel prices may remain stable over the next three to six months. Further narrowing of market deficit on account of improved global supply and reduced consumption will cap the nickel prices. The average prices may increase to $10,250 per tonne in 2017, but may gradually decline to average at $ 9,000 per tonne by 2021.