Nickel price to benefit from short supply, strong steel demand through 2019
JAKARTA, Sept 12 (Reuters) - Slower production increases in leading supplier Indonesia and continued growth in stainless steel demand are forecast to extend a supply shortage in the global nickel market, supporting price gains through 2019.
Nickel, which recently hit its lowest since December, could climb as high as $16,000 a tonne by the end of 2018 and $18,000 a year later, Macquarie Capital senior commodities consultant Jim Lennon said on the sidelines of the MetalBulletin 6th Asian Nickel Conference in Jakarta on Wednesday.
Nickel has been supported by stainless steel demand growth that exceeded 9 percent in the first half of 2018, Lennon said.
But concerns have emerged in recent months that global growth has peaked against the backdrop of an evolving trade war between the United States and China, dampening the outlook for the 2.2-million-tonne per year global nickel market, he said.
As a result, nickel prices had “overshot to the downside”, he said, noting that he expects China to relax its credit policies and introduce measures to stimulate growth that would underpin steel demand, while nickel output growth will remain slow for the rest of 2018.
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