CM’s research into the global nickel industry began in 2007, when the company conducted a detailed assessment of the emergence of nickel pig iron (NPI) production in China as an alternative means to produce nickel units suitable for China’s growing stainless steel industry. Since then, CM has kept very close to industry developments by conducting numerous field studies within China, as well as to Indonesia and the Philippines, to closely monitor the evolution of nickel laterite mining, NPI production and stainless steel production across all three countries. Our capacity and production databases are all regularly updated, as are our cost models and views on the outlook for the industry.

Over the past three years, LME nickel prices gained around 50%, driven almost entirely by demand from the global stainless steel sector, especially in China. Recent developments in battery technology have resulted in additional, although modest, increases in global nickel demand, however this sector remains small and, given ongoing developments in the battery technology sector, it remains to be seen whether batteries will significantly increase the demand for nickel in the years ahead.

More recently, visible nickel inventories have fallen markedly, although the lower industry cost structure, driven by increasing volumes of NPI production, have muted any significant market response to low inventories.

The stainless steel production growth engines of China and Indonesia continue to dominate the sector, especially Indonesia, which has become a stainless steel production powerhouse over the past five years, driven by the integrated economics of laterite mining, NPI production and stainless steel production, and the restrictions imposed by Indonesia’s minerals export ban, which significantly limits Ni laterite exports, forcing companies to add value in-country. Indonesia is now poised to become a significant exporter of stainless steel to the world, which could result in a significant disruption to the current trade patterns in the sector.

The CM Group has a proven capability to conduct detailed market studies, supply demand analyses and a range of other specific, single scope studies in China as well as other South East Asian countries. CM’s project work regularly sees its teams on the ground in countries as diverse as Indonesia, Jamaica, Malaysia, the Philippines, Guinea, Brazil, Myanmar and Vietnam. Our regional hubs in Singapore, Chengdu and Beijing reduce the need for lengthy field visits because we can deploy our specialist teams to target locations quickly and at low cost.

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