Blockchain, commodities & Trading


New Caledonia: market collapsed

New Caledonia is the world’s fourth largest producer of mined nickel, behind Indonesia, the Philippines and Russia. It exports minerals mainly to South Korea, Japan and China.
The country accounts for about 9% of the world’s mined nickel production and produces around 200,000 tons per year, according to the International Nickel Study Group (INSG).

France is also the third largest supplier of nickel and concentrate ore to China’s largest metal consumer. The latest INSG forecast, released last October, sets the world market for refined nickel at a surplus of 68,000 tons this year, down from a surplus of 117,000 tons in 2020.
The surplus is estimated to shrink to 25,000 tonnes this year as the global economy picks up and demand for electric vehicles and batteries pick up.

China is the largest nickel consumer in the world, with its huge steel and manufacturing sectors accounting for more than half of the world’s primary nickel use, INSG data showed. The country consumes about 1.3 million tons of primary nickel per year. However, China’s nickel ore stocks dropped sharply following a ban on exports of iron ore from the leading Indonesian producer from 2020.

  • So prices have moved widely sideways since the news broke. Consider any interruptions in supply due to the collapse of the government.

While other countries may increase shipments to fill any supply gaps from New Caledonia, a tight market in China and resurgent demand elsewhere will likely keep nickel prices well supported this year.
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