The price of nickel has shot up over 50% since the beginning of 2019 and exceeded US$16,000 per tonne in early August, but the Russian industry remains dominated by Arctic behemoth PJSC Norilsk Nickel Co., with only two other significant projects on the horizon.
While stainless steel remains nickel’s main source of demand for the time being, Russia’s large sulfide reserves position it particularly well for a future electric vehicle boom, which would require more batterygrade metal. Though Indonesia has the world’s largest reserves, they comprise low-grade nickel laterite, which is suitable for steelmaking but cannot be economically used as battery material.
“Plug-in electric light duty vehicles are likely to account for 11% of global light duty car sales in 2025, rising to 23% and 50% by 2030 and 2040, respectively,” according to S&P Global Platts Analytics Scenario Planning Service.
Mining industry consultancy CSA Global is being engaged and proposing for slightly more nickel work in Russia, according to Manager Brendan Clarke. “As a group, [there is,] certainly, more nickel work floating around particularly in lower risk jurisdictions and brownfield plays,” he told Market Intelligence. “The real issue is the long lead time to development of nickel projects.”
It is reasonable to expect continued growth in Russian nickel production, mainly from Norilsk but also through joint ventures with smaller producers, according to Aperio Intelligence’s George Voloshin.
SOURCE: MARKET INTELLIGENCE
DATE: AUGUST 23, 2019