Indonesia’s new capacity could boost global nickel output by 20% a year in 2022, to 3.14m tonnes, and by a further 8% in 2023, to 3.41m tonnes, according to Antaike data.
Antaike forecasts the London Metal Exchange average nickel price to fall 20% a year in 2023 to $20,000 a tonne, after a 35% jump in 2022 to $25,000 a tonne, which was partly due to a nickel trading crisis on the LME in March.
However, the near-term nickel price could be supported by rising ore and electricity costs. A possible Indonesian export tax on nickel would also push prices up in the short term, he added.
“When the tax is imposed, nickel prices will rise in the short term. But it is unlikely to last as the increase in production would put some downward pressure on the market,” Xu said.
LITHIUM AND COBALT
The global lithium market is expected to be in surplus of 30,000 tonnes of lithium carbonate equivalent (LCE) this year, up from a surplus of 6,000 tonnes of LCE in 2021.
However, the Chinese lithium market departs from the global trend. Antaike foresees a deficit of 12,000 tonnes of LCE for China in 2022.
Chinese lithium prices soared as demand from the booming electric car industry outpaced sluggish production growth due to slow approvals and emissions restrictions, Xu said.
Recent power rationing in China’s Sichuan and Zhejiang provinces – both major lithium production hubs – has also helped push prices up.
“Lithium prices will only stabilize when supply growth matches demand growth,” Xu said.
Meanwhile, the global cobalt market could post a further 8,000-tonne surplus in 2022, up from a 2,000-tonne surplus in 2021, according to Antaike data.
Weak demand will put pressure on cobalt prices both in Chinese markets and outside of them, Antaike analyst Liu Yimin said.
(Reporting by Siyi Liu in Dezhou, China, and Mai Nguyen in Hanoi; edited in Spanish by Ricardo Figueroa)
Source: Ambito
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