- Indonesian govt seizes Tsingshan’s Weda Bay mine land
- Weak US dollar, strong inflation trend support prices
Nickel futures on the London Metal Exchange (LME) closed at $15,345/t on 12 September, marginally higher than last week’s $15,280/t. LME warehouse inventories rose 4% w-o-w to 225,084 t against 215,418 t. Prices started weaker but recovered mid-week, supported by optimism over a potential US Fed rate cut, supply concerns in Indonesia, and favourable macroeconomic signals, offsetting persistent supply-side pressure.
Macro factors
US inflation, Fed outlook boost nickel market sentiment
The US dollar weakened on a stronger-than-expected August Consumer Price Index (CPI) rise, supporting nickel’s uptrend. Market expectations for a Fed rate cut this month remain firm, tied to economic headwinds shown by rising jobless claims. Earlier, the Fed had held rates steady at 4.25-4.50% since December 2024, balancing inflation and growth. Now, to support a weakening labour market and economic stability, a 25 basis point cut is expected in September, with potential further cuts in 2025. This easing is boosting nickel sentiment, though supply surplus and weak demand limit sustained rallies.
Indonesian govt’s Tsingshan mine seizure triggers nickel rally
Indonesia’s government seized 148 hectares at Tsingshan’s Weda Bay Nickel mine for permit violations and forest encroachment, sending LME nickel futures up by up to 1.6%. The move highlights tightening regulations and supply risks from the world’s leading nickel producer, with smelters already struggling with weather and quota constraints. Operational impact remains limited for now.
Danantara in talks for strategic investment in Vale’s nickel smelter projects
PT Vale Indonesia confirmed that the Danantara Investment Managing Body is discussing investments in three nickel smelter projects. These include collaborations with Zhejiang Huayou Cobalt and Ford in Pomalaa, a renewable energy-powered facility in Sambalagi, and another project in Sorowako. The partnership aims to boost funding and accelerate development, focusing on environmentally friendly energy and supporting global decarbonisation efforts.
Leave a Reply