Nickel hits 13-year lows on falling Chinese steel demand

SEATTLE (Scrap Monster): The sharp decline in Chinese demand continues to keep nickel prices under pressure. The metal prices slumped to almost 13-year lows at US$7,900 per tonne on the London Metal Exchange (LME). These price levels were seen last in April 2003.

The drop in nickel prices is mainly attributed to declining steel production in China. The most recent data released by the China Iron and Steel Association (CISA) indicates that Chinese steel production declined considerably by 7.2% in December 2015, when matched with the previous month. The prices of nickel have dropped nearly 42% during the entire year 2015. The prices plunged by almost 8% during the past one month. Incidentally, nickel has turned out to be the worst performing metal so far this year.

The low metal prices have forced many smelters to shut their operations, leading to lay off of several workers. Panoramic Resources which had shut down its Lafranchi nickel mine few months back, has also announced suspension of operations at its Savannah mines. Also, Anglo American plans to make complete withdrawal from its Brazilian nickel assets, as part of its efforts to sell its non-core assets.