Nickel prices to drop by 12% amid concerns of oversupply

Metal Recycling News  |  2011-06-13 07:57:23   |   By

The nickel prices are facing a major concern as its surplus is expected to rise 60,000 metric tons from 12,000 tons in 2011. This is expected to make nickel the most oversupplied metal relative to output or use. As per Bloomberg survey, nickel prices are expected to drop by 12% to $ 20,000 a ton by Dec 31.

LONDON (Scrap Monster): The nickel prices are facing a major concern as its surplus is expected to rise 60,000 metric tons from 12,000 tons in 2011. This is expected to make nickel the most oversupplied metal relative to output or use. As per Bloomberg survey, nickel prices are expected to drop by 12% to $ 20,000 a ton by Dec 31.

Nickel fell 8.5 percent to $22,648 this year by 6:56 a.m. on the London Metal Exchange, making it the third-worst performer after raw sugar and zinc on the Standard & Poor's GSCI index of 24 commodities.

While raw-material producers are failing to extract enough copper and oil and droughts threaten crops, nickel supply is expanding faster than demand.

Nickel prices reached a record $51,800 in 2007 and moved at least 63 percent a year since then, leading consumers to look for substitutes.

According to report by Societe Generale SA, lower prices may force higher-cost smelters to curb or halt output, limiting declines. Reduced demand from stainless steelmakers and rising energy costs make it more likely that privately owned smelters will stop operating in second half of 2011……read more on this