Macquarie Bank Picks Nickel To Be Top Commodity in 2019

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    Nickel along with other commodities has bounced to…



    Good call nickle hit a five-year high a few days ago has pulled back but market remains bullish about the metal that counts stainless steel as its primary end-market is hot.

    Indonesia said it would ban exports of nickel ore from January 1, 2020.
    Indonesia’s move comes two years earlier than expected, as Jakarta aims to build up local resources.
    Indonesia is the second-largest producer of nickel ore in the world, behind the Philippines.
    Nickel climbed to a five-year high of $18,785 on the London Metal Exchange after the ban was announced.

    Bambang Gatot Ariyono, the director of Indonesia’s mining ministry for coal and minerals, told reporters that the ban applies to all grades of nickel ore and that all exporters should cancel contracts dated beyond the start of the new year.

    “We already exported 38 million tons up until July this year,” Bambang said at a press conference on Monday, the Jakarta Post reported. “At this rate, we would need to think about our reserves especially if we keep issuing exports permits.”

    Most of Indonesia’s nickel exports go to China, where they’re processed into nickel pig iron.

    The move will create a gap in the nickel market of 100,00 tonnes a year, Colin Hamilton, a managing director of commodities research at BMO Capital Markets, told the FT.

    “This cuts off one of the major sources of raw material to the Chinese nickel pig iron industry.”


    Goldman Sachs analysts predict the export ban could drive its price up another 7% to $20,000 a ton by the end of the year, the FT said.

    Nickel was trading at $18,662.50 at the time of writing.

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