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Russian miner Norilsk Nickel is considering lowering their output by 10% next year. The company estimates 2022 production will be 205,000 to 215,000 mt, thus, output in 2023 could range between 184,500 to 193,500 mt. Norilsk claims the potential drop in production is due to falling European demand for Russian metals. Based on USGS data, Russia is the world’s third largest nickel miner, responsible for approximately 9.3% of global nickel mine production. |
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However, production elsewhere could be on the rise. Tsingshan Holding Group Co., which is the world’s largest nickel producer, plans to open a 50,000 mt/yr plant in Sulawesi, Indonesia by July 2023. According to unnamed sources recently interviewed by Bloomberg; Tsingshan may decide to double the size of the plant to 100,000 mt/yr. Refined nickel production in the region could grow further, as two other Chinese producers, CNGR Advanced Material Co., and Zhejiang Huayou Cobalt Co. are proposing similar operations in Indonesia and China, respectively. Indonesia is the world’s largest nickel producer, according to USGS data. (Source: Bloomberg, USGS) Nickel prices at the LME are up over 5% this month, even as the supply picture remains unclear. Nickel is one of the best-performing LME metals in 2022, with prices up nearly 36% this year. That said, this still could be a good time for end-users such as stainless-steel producers to hedge future needs by buying swaps. Such positions are standard for consumer hedging; however, they can result in opportunity costs or cash costs if metal prices decrease. Please contact AEGIS for specific strategies that fit your operations. (12/21/2022) |
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Note: Clients with AEGIS Platform access can see this and other research, plus hedge portfolio reporting and tools here. |
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AEGIS Insights |
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12/14/2022: Could Peruvian Protests Affect Zinc Production or Prices? 12/14/2022: AEGIS Factor Matrices: Most important variables affecting metals prices 12/07/2022: Does the Copper Rally Have Legs? 12/01/2022: What's Been Driving Aluminum Prices Lately? 11/17/2022: Do Chinese Aluminum Import and Export Flows Affect LME Prices? |
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| Important Headlines | ||
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12/20/2022: Who’s in the driver’s seat: U.S. steel and scrap dynamics 12/20/2022: USW approves new contract with US Steel 12/20/2022: US HRC: Prices rise, demand slows 12/20/2022: Column: Zinc stocks at historic lows after a year of smelter woes 12/19/2022: Tesla hits 3,000 cars a week in Berlin, Austin later than planned 12/19/2022: Norway's Hydro plans wind farm to power industrial plants 12/18/2022: China November aluminium imports fall amid rising domestic supply 12/16/2022: First Quantum mulling all legal options after Panama halts flagship mine |
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Important Disclosure: Indicative prices are provided for information purposes only, and do not represent a commitment from AEGIS Hedging Solutions LLC ("Aegis") to assist any client to transact at those prices, or at any price, in the future. Aegis makes no guarantee to the accuracy or completeness of such information. Aegis and/or its trading principals do not offer a trading program to clients, nor do they propose guiding or directing a commodity interest account for any client based on any such trading program. Certain information in this presentation may constitute forward-looking statements, which can be identified by the use of forward-looking terminology such as “edge,” “advantage,” “opportunity,” “believe” or other variations thereon or comparable terminology. Such statements are not guarantees of future performance or activities.
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