The Asia Miner

OCT-DEC 2018

The ASIA Miner - Reporting Important Issues to Mining Companies in the Asia Pacific Region

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the asia miner • volume 15 • issue 4 25 FEATURE: Nickel FUTURE OF NICKEL: TRENDS AND PREDICTIONS The focus is already shifting to nickel supplies, with the expected EV boom fuelling a spike in global prices When we think of the transiঞon to green energy, cobalt and lithium tend to dominate discussions surrounding the minerals required for this shi[ to take place. Partly, because base metals like nickel are not produced solely for the purpose of green technologies. Rather, as sated by the Nickel Insঞtute, it is used in more than 300,000 products worldwide, ranging from consumer to aerospace applicaঞons. Of the 2.1 million metric tonnes of nickel content produced in 2017, approximately 65 per cent was used to manufacture stainless steel, while only 6 per cent was devoted to the producঞon of coins, electronics and rechargeable baeries. While nickel producঞon has slowed in recent years due to an abundance of supply and price fluctuaঞons, the transiঞon to EVs is expected to revitalise global interest in the commodity. According to the Internaঞonal Nickel Study Group, China is a significant source of this growing demand, accounঞng for 52 per cent of world nickel demand and more than 40 per cent of the world's EV car stock. Due to efficiency, price and ease of manufacturing, there are currently two types of lithium-ion baeries making up the majority of the EV market: nickel manganese cobalt and nickel cobalt aluminium, which require a rate of 30 and 80 per cent of nickel respecঞvely. According to the World Bank, the transiঞon to solar technologies could also increase the demand for nickel by 300 per cent through 2050. PRICES Nickel prices appear to be dropping from their surge in May and early June, when they were driven by higher stainless steel producঞons. According to the Australian Government's Resources and Energy Quarterly, nickel prices have been "subject to high volaঞlity in recent months, buffeted by trade tensions, producঞon pauses among Asian refineries, and various other minor disrupঞons and industrial disputes, which have led to swings in nickel supply". The Office of the Chief Economist predicts that "prices are expected to smooth out somewhat as markets sele in coming months, averaging around just over US$13,600 for 2018 as a whole", with prices stabilising over the next two years, reaching around US$13,250 by 2020 as new producঞon enters the market. WORLD CONSUMPTION Nickel consumpঞon is expected to rise from 2.3 million tonnes in 2018 to 2.5 million tonnes by 2020. With stainless steel accounঞng for a majority of nickel use, the Australian Government believes that it will account for most of its growth. The Brazilian mining company Vale SA stated in its Q2 report that "global stainless-steel producঞon increased 8.6

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