(April 27): Nickel rose to the highest in almost two years as reduced mining quotas in major producer Indonesia and a global sulphur shortage tighten the supply outlook for the battery metal.
Futures in London have risen about 10% since the start of the Iran war, which is driving a surge in prices of sulphur — a key reagent used in processing — and fuelling concerns over disruptions to global mining, including mixed-hydroxide precipitate production in Indonesia and copper leaching in Africa.
Nickel climbed as much as 2.6% on Monday. Other base metals were mixed, as traders assessed the chances for a conclusion to the war after a report that Iran has offered the US a new proposal to reopen the crucial Strait of Hormuz.
Nickel mining in Indonesia is already under pressure after the country slashed its production quota to revive prices for the metal. The Asian country accounts for well over half of global production, thanks to a wave of Chinese investment in smelters.
“Market sentiment on nickel remains positive as traders await further upside catalysts pointing to a substantial production cut in MHP,” Jinrui Futures Co said in a note, referring to the mixed-hydroxide precipitate, an intermediate product containing nickel.
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Nickel was up 2.5% at US$19,495 a tonne by 10.35am local time on the London Metal Exchange and touched the highest since June 2024. Copper was steady at US$13,317 a tonne while tin was down 0.6% to US$50,055 a tonne.
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