Nickel

Nickel (atomic symbol Ni) is a hard, malleable, ductile metal that has a silvery tinge that can take on a high polish. Nickel is somewhat ferromagnetic and is a fair conductor of heat and electricity. Nickel is primarily used in the production of stainless steel and other corrosion-resistant alloys. Nickel is used in coins to replace silver, in rechargeable batteries, and in electronic circuitry. Nickel plating techniques, like electro-less coating or single-slurry coating, are employed in such applications as turbine blades, helicopter rotors, extrusion dies, and rolled steel strip.

Nickel futures and options trade at the London Metal Exchange (LME). The nickel futures contract calls for the delivery of 6 metric tons of primary nickel with at least 99.80% purity in the form of full plate, cut cathodes, pellets or briquettes. The contract is priced in terms of US dollars per metric ton.

Prices – Nickel prices in 2003 staged an impressive rally along with the rest of the basic metals complex, nearly quadrupling from the lows seen in late 2001. Nickel prices hit bottom in late 2001 at around per metric ton. But then the market really took off in mid-2003 with a rally from the ,000 per metric ton area up to a high of nearly ,000 by the end of the year.

Supply – World mine production of nickel in 2001, the latest reporting year for the data series, rose +3.1% to a record 1.330 million metric tons. That is approximately double the production seen in 1970. The world’s largest mine producers of nickel in 2001 were Russia (with 24.4% of world production), Australia (14.8%), Canada (14.5%), New Caledonia (8.8%), and Indonesia (7.7%). In 2001, US secondary nickel production rose to a record high of 101,000 metric tons from 84,000 metric tons in 2000.

Demand – US consumption of nickel in 2001 fell to 188,000 metric tons from 189,000 metric tons in 2000, but was only mildly below the record high production level of 191,000 metric tons posted in 1997. The primary US nickel consumption use is for stainless and heat-resisting steels, which accounted for 64% of US consumption in 2001. Other sectors were super alloys (9.8%), nickel alloys (9.7%), electro-plating anodes (6.6%), alloy steels (4.1%), copper base alloys (3.7%), chemicals (0.9%), and cast irons (0.5%).

Trade – The US relied on imports for 56% of its nickel consumption in 2001. US imports of primary and secondary nickel in 2001 fell to a 7-year low of 144,760 metric tons from 166,700 metric tons in 2000. US exports of primary and secondary nickel in 2001 were 57,050 metric tons, only mildly below the record high of 58,050 metric tons posted in 2001.