Metals: Nickel rises to highest since October 2019 on steel boom

MM2 Asia

10/12/2020 12:09

(Updates throughout, adds LONDON dateline)
    LONDON, Dec 10 (Reuters) - Nickel prices on Thursday rose to
their highest since October 2019, powered by expectations of
strong demand from Chinese steel mills and falling stockpiles in
Chinese exchange warehouses.  
    Benchmark nickel  CMNI3  on the London Metal Exchange (LME)
was up 0.7% at $16,815 a tonne, taking its gains since March to
more than 50%. 
    Powering the rally for the stainless steel ingredient is a
rebound in Chinese industry after coronavirus interruptions
earlier in the year. 
    Underlining the strength in demand from China's steel
sector, the world's largest, is a rapid rally in iron ore
futures, which leaped more than 7% on Thursday to a contract
high of 976 yuan ($149.10).  DCIOcv1   urn:newsml:reuters.com:*:nL1N2IQ0EJ  urn:newsml:reuters.com:*:nL4N2IP18A
    "Demand for stainless steel has been strong this year,
particularly out of China, and that's driving the market because
it's 75% of usage," said independent analyst Robin Bhar.
    "There is also a need for prices to remain attractive -
above $15,000-$16,000 - to provide an incentive for miners," he
said. 
    
    STOCKS: Nickel stocks held in warehouses monitored by the
Shanghai Futures Exchange have fallen to 18,361 tonnes, the
lowest since mid-2019.  SNI-TOTAL-D 
    However, inventories in LME-registered warehouses at 243,426
tonnes are the highest since mid-2018.  MNISTX-TOTAL 
    FORECAST: Analysts at ANZ said nickel prices would average
around $16,500 a tonne in 2021. 
    MARKETS: Stock markets and the dollar were largely steady.
 MKTS/GLOB   FRX/ 
    ECB: The European Central Bank is expected to unveil fresh
stimulus measures on Thursday.  urn:newsml:reuters.com:*:nL8N2IP3K8
    ECONOMY: U.S. economic growth will lose momentum this
quarter and next but expand faster than previously thought after
that, according to a Reuters poll of economists.  urn:newsml:reuters.com:*:nL4N2IP1V9
    RUSSIA: Russian aluminium, nickel and copper exports
declined in the first ten months of 2020, customs data showed.
 urn:newsml:reuters.com:*:nAZN00N4GI
    JAPAN: Japan will extend tax breaks on low-emission cars and
offer incentives to promote green investment.  urn:newsml:reuters.com:*:nL4N2IP1YX
    OTHER METALS: LME copper  CMCU3  was up 0.2% at $7,740 a
tonne, aluminium  CMAL3  was 0.5% higher at $2,046, zinc  CMZN3 
was down 0.5% at $2,840.50, lead  CMPB3  fell 0.7% to $2,094.50
and tin  CMSN3  was up 0.5% at $19,545.

 (Reporting by Peter Hobson
Additional reporting by Enrico Dela Cruz
Editing by Mark Potter)
 ((Peter.Hobson@thomsonreuters.com; +44 207 542 0083;))
 
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