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Norilsk Nickel predicts recovery in nickel prices

Moscow 30.03.2012  have since the beginning of 2011, nickel prices almost halved. When it comes to the Russian mining giant Norilsk Nickel, the price decline is likely, however, directly in front of his end and the Russians can even imagine that the prices of the industrial metal tighten moderately.

For the current year, the Group expects a price level around $ 20,000 per tonne. This essentially corresponds to the average price in the opening quarter of 2012. Posed by the current market prices. Unless Norilsk Nickel properly to the market perception is, equivalent to an upside potential for nickel by about 15 percent.

Profitability of many deposits at risk

The main reason for a possible recovery in prices lead to the Russians that if nickel prices below $ 18,000 per tonne, the profitability of many reservoirs is significantly jeopardized. According to the company, prices lasting less than $ 20,000 could result in the global nickel mines emissions are reduced by five percent because of inefficiency. The Russians see themselves affected by them could be restricted. The Australian and African mines of the company are also working currently profitable and in the Far Eastern Russian deposits insufficient cost is not an issue anyway.

Oversupply but before expansion

Notwithstanding possible production losses should the nickel market in the current year remain more than adequate supply. Analysts expect a rise of over-production of 17,000 tons to 50,000 tons last year, the 2012th Because of the demand side, in view of the somewhat sluggish running the world economy can not be expected with great relief pulses nickel stocks will continue to rise. That this tendency exerts pressure on prices, needs no further explanation.

Conclusion:

The price forecasts for nickel Russians are therefore likely to be characterized by a considerable degree of optimism purpose. After all, Norilsk Nickel is the world's largest producer of non-ferrous metal, which is used mainly for steel refining. And even if the steel sector - like the iron ore sector - most recently exhibited unmistakable signs of stabilization, nickel should find it difficult to achieve in the coming weeks and months, a trend upward.