According to Meps, nickel’s price surge has continued, creating fresh headaches for participants in the stainless steel market. In London Metal Exchange trading in the last week of April, nickel prices reached a peak of USD 20,000 per tonne. Some observers attribute nickel’s soaring price to a physical shortage of metal. Demand is increasing because of the rise in stainless steel production and higher consumption of nickel-base alloys by the aerospace sector. At the same time, nickel supply is being restricted by unexpected shutdowns at a number of producers. Labour disputes are threatening to disrupt some nickel companies’ production later in the year. But this talk of shortages goes against the experience of some stainless steel mill purchasing officers, who say they are not experiencing any difficulty in obtaining metal. They see the price being driven – not by the normal issues of supply and demand – but by commodity fund investors and speculators. Whatever its cause, the high nickel price is a reality and other stainless steel production costs are also rising.
