Nickel has been the worst performer of the London Metal Exchange’s six major metals over the past year. The key ingredient in stainless steel, which topped $50,000 a metric ton in 2007, has barely risen above $10,000 in eight months.
Between 60 percent and 70 percent of producers are losing money at current prices, Ivan Glasenberg, chief executive of the fourth-biggest producer, Glencore, told an investor call in December.
In trying to deal a blow to a mining industry he accuses of “spoiling the land,” Philippine President Rodrigo Duterte, also known as the “Punisher,” may have just done global producers a favor.
Nickel traded on the LME rose at the fastest pace in more than eight months Monday. The proximate cause was Duterte’s new environment and natural resources minister, Gina Lopez, who said miners that don’t pass an environmental audit to be completed in three to four weeks face suspension. A review will be completed in three to four weeks. Less than a third currently meet international standards, Lopez said last week.
The news isn’t exactly a bolt from the blue. Duterte has been a longstanding critic of mining companies, passing a law to enforce a ban on them in his home city of Davao while he was mayor. It moved the market because the Philippines is far and away the biggest producer of mined nickel, according to the U.S. Geological Survey, overtaking Indonesia since that country banned exports of metal ores in an attempt to encourage a local smelting industry.
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