Nickel price reaches its highest level in a decade at 25,000 USD per ton
Nickel hit $25,000 a tonne for the first time since 2011, extending a rally driven by dwindling global inventories and fears that tensions in Ukraine could disrupt supplies from the main Russian producer.
The metal, used in stainless steel and rechargeable batteries, rose 3.2% to $25,135 a tonne. It is the best performer on the London Metal Exchange this year, climbing amid a flurry of forecasts that supply will lag behind rapidly growing demand from the electric vehicle industry.
Commodity investors were weighing the potential damage of sanctions on Russia after President Vladimir Putin recognized two breakaway republics in eastern Ukraine and ordered the dispatch of troops. The European Union and the United Kingdom introduced initial sets of sanctions aimed at Moscow in response to Putin’s decision to recognize the breakaway regions.
Nickel is “one of the top commodities tied to Russia given its importance to supply,” said Ryan McKay, commodity strategist at TD Securities. “Thus, the latest events keep the supply risk for the metal particularly high, especially as inventories are already at very low levels.”
Nickel inventories on the LME have fallen to their lowest since 2019 with a significant pullback – when spot prices are much higher than futures – indicating very tight fundamentals. Stocks continued to fall on Tuesday.
