Pt
 
   English Português  
Developing the next major nickel project in Brazil
Slide 1

Nickel FAQ

Nickel Use

Use

Nickel is a US$30 billion per year industry with 66% of nickel going into stainless steel production. Overall there are over 3,000 nickel-containing alloys in everyday use including batteries. Nickel use in batteries could more than double over the next 10 years from around 70,000 tonnes to close to 160,000-170,000 tonnes according to Macquarie's research.

«our cells should be called Nickel-Graphite, because primarily the cathode is nickel and the anode side is graphite with silicon oxide....[there’s] a little bit of lithium in there, but it’s like the salt on the salad» Elon Musk, Tesla, 2016.

Prices

In the first quarter of 2017, nickel prices stood at slightly below US$10,000 per tonne having hit a 13 year low of US$7,750 per tonne on London Metal Exchange a year earlier. UBS are one of several banks that are bullish on nickel prices and forecast US$13,775 per tonne by the end of 2017, with JP Morgan rating it their second most bullish metal view going into 2017. In 2007 Nickel reached an intraday record of US$51,800 per tonne.

Demand

Stainless steel production (which represents approximately two thirds of nickel demand) was growing strongly in China at the end of 2016 at >+20% year on year, with momentum reported into the beginning of 2017. Future demand growth looks to continue to be robust and in the region of 2% per annum and importantly out pace supply growth.

Supply

For 2017, key to the global market is supply of nickel ore from Indonesia and the Philippines, which is in a state of flux in both cases and has proved difficult to predict a stable outcome. The ongoing market deficit of approx. 50,000 tonnes (Macquarie March 2017) in 2017 suggests that prices should be higher in 2017 than in 2016 and the ongoing forecast deficit for the next few years implies that inventories will reduce continually out to 2020 when they are forecast to reduce to negative levels. Macquarie also note that with «Chinese ore stocks approaching critically low levels, would imply significant upside to nickel ore prices».

Cost Profile

Nickel industry C1 cost demonstrates 50% of operations produce at US$9,873 per tonne (US$4.48 per pound) around 40 to 50% of operations sub-economic today.