LME Considers New Nickel Contract to Tap Boom in Electric Cars
Comment of the Day

October 30 2017

Commentary by Eoin Treacy

LME Considers New Nickel Contract to Tap Boom in Electric Cars

This article by Mark Burton and Jack Farchy for Bloomberg may be of interest to subscribers. Here is a section: 

The LME is considering starting a nickel sulphate contract as part of a trio of new products that take advantage of growing demand for battery metals, according to Chief Executive Officer Matthew Chamberlain. The launch is 18 months away at best, he said in an interview Friday, ahead of the metal industry’s annual gathering in London.

“Electric vehicles are clearly the growth story for our industry,” Chamberlain said. The bourse will meet with stakeholders in the electric vehicle market during LME Week to firm up plans for new nickel, cobalt and lithium chemical contracts, he said.

Eoin Treacy's view

I posted a report from Vale on October where they made clear how they see the growth in the nickel market is likely coming from batteries and additionally how much additional investment is going to be required to develop the resources necessary to deliver the quality of nickel required to supply the market. That suggests nickel is evolving into a supply inelasticity meets rising demand market; provided of course the futures markets evolves along with it. 

Sherritt International remains in an almost two-year base formation following last week’s pullback but it has paused this week. A sustained move above C$1.50 would be required to signal a return to medium-term demand dominance. 

Back to top

You need to be logged in to comment.

New members registration