Macquarie: Global Nickel Market to Witness Surprise Deficit in 2024

SEATTLE (Scrap Monster): According to latest forecasts by Macquarie Group Ltd., the global nickel market could swing to a surprise deficit in 2024. The projected market surplus is mainly on constrained growth in Indonesian mine output on account of slowdown in permit approvals.

The latest forecast is a major change from its recent forecasts. As a base-case scenario, the bank predicts a surplus of less than 40,000 tons, which may be further widened in the event of delay in mining approvals and a dip in full-year local production by more than 13% year-on-year, the analysts noted.

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The nickel supply from Indonesia had registered robust surge by 45% during the previous year, thus leading to significant decline in benchmark nickel prices. However, the permit approvals have been proceeding in a slow pace in 2024, although the country’s government has vowed to clear the permits this month itself. It must be noted that nickel ore in the country has been trading at a premium of more than $7 per ton.

According to government officials, the nickel prices are unlikely to rise much above $18,000 a ton on the London Metal Exchange (LME).

Outside Indonesia, the Chinese stockpiles are expected to be at lower levels, driven by projected jump in consumption.