New nickel price launched as attention shifts to green supply

The price of nickel held onto nine-month highs on Tuesday as focus in the industry shifts to supply of the metal for the burgeoning electric vehicle market, and mine production declines hit double digits.

On the LME, nickel was exchanging hands for $14,925 a tonne ($6.77 a pound), the highest since mid-November last year and up by more than a third from its March lows.

Nickel production nixed

The Lisbon-based International Nickel Study Group reports global mined nickel fell 7.7% in June compared to the same month last year, which still counts as something of an improvement from the sharp falls in April and May. 

Year to date production has fallen by more than 10% to 1.1 million tonnes due to covid-19 related disruptions in major producing regions including Philippines (–28% drop in output year-on-year), Canada (–19%) and Indonesia (–11%).

Pally up with Indonesia

New projects to feed the EV supply chain are primarily in Indonesia at operations that use high pressure acid leaching (HPAL) to extract nickel and cobalt from these low-grade ores.

Like Ramy, many of these use deep-sea tailings as a means of waste disposal.

“For new nickel supply, Elon and the battery industry look to HPAL in Indonesia,” Simon Moores, founder and managing director of London-based Benchmark