Nickel rallied for a fourth consecutive day on the prospect of coordinated output cuts by Chinese producers in Indonesia, raising expectations of tighter supply. The metal climbed as much as 2.7% to pass $16,000 a ton on the London Metal Exchange, building on gains since hitting a nine-month low last Thursday. Executives from several major Chinese nickel producers are considering potential output curbs at their Indonesian operations, including plants producing key battery feedstock.
A previous attempt to agree on cuts in August had been unsuccessful. "What everyone is really focused on right now is the size of the production cuts," said Gao Yin, an analyst at Shuohe Asset Management Co. "The numbers being circulated in the market are quite significant." Producers in Indonesia have been grappling with weaker prices and rising costs, while tighter mining quotas have constrained ore supplies. The Southeast Asian nation dominates global nickel production, making changes to output there a key market driver. Prices were up 2.3% at $16,025 a ton on the LME at 2:31 p.m. in Shanghai, trimming this year's decline to less than 4%.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing