Future demand looks robust with predicted growth running between 2% and 4% this year and demand is anticipated to outpace supply, ensuring that Araguaia is a compelling project to generate value for shareholders.
The Macquarie Group estimates a global nickel shortage of ~100,000 tons in 2016, followed by another deficit in 2017. Macquarie Bank stated that “better demand has led us to revise up our projected deficits for 2016 and 2017, even without factoring in any government-enforced closures in the Philippines," (July 2016).
66% of nickel goes into stainless steel. Overall there are over 3,000 nickel-containing alloys in everyday use. Nickel is a S$30 billon per year industry.
In the first quarter of 2016, nickel hit a 13 year low of US$7,750 on LME. Prices have since increased to US$10,500 but still remain at multiyear lows. In 2007 nickel reached an intra day record of US$51,800
Nickel industry C1 cost demonstrates 50% of operations produce at US$9,873/tonne (US$4.48/Ib) around 40 to 50% of operations sub-economic today
Global demand for nickel has grown at an average of 6.3% since 2010, estimated between 2.4 – 4.4% growth for 2016. The market returned to balance in Q4 2015 and is expected to show 100,000 tonne deficit by end of 2016