Nickel Metals Report Q2 2016
BMI View: Nickel prices will bottom in 2016 as weak production drags the global market into deficit. Forinstance, we expect Chinese imports of nickel to grow over the coming quarters. Prices will begin 2016weaker than we had previously expected and we have thus revised down our 2016 average price forecast toUSD9,000/tonne from USD10,500/tonne.
Latest Developments And Structural Trends
Refined nickel prices will remain under pressure on a three-month horizon, trading in theUSD8,000-9,000/tonne range. While the market will gradually begin to tighten as elevated Chineseimports erode global stockpiles, investor sentiment towards industrial metals will remain cautious asChinese economic data continues to disappoint. By H216, we expect strengthening fundamentals in thenickel market and a more general bounce in metal prices will start to push prices towards USD10,000/tonne.
We have lowered our nickel price forecasts for the coming years due to a more positive view on globalsupply trends, particularly from Indonesia. We now forecast an average of USD9,000/tonne andUSD10,500/tonne in 2016 and 2017, compared to our previous forecasts of USD10,500/tonne andUSD11,500/tonne, respectively.
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