MOSCOW – Russian mining giant Nornickel, previously known as Norilsk Nickel (GMKN.MM), expects nickel CMNI3 prices to rise to about $10,000 a tonne by the end of the year and flatten out around that level through 2017, its chief operating officer said.
The stainless steel ingredient has been a top performer on the London Metal Exchange this year, with prices up about 30 percent since February lows to $9,730 a tonne.
Its climb has mainly been driven by concern over supplies after mine closures in the Philippines and Indonesia’s 2014 ban on nickel ore exports. “Everyone is keeping an eye on the development in the Philippines and Indonesia,” Nornickel’s Sergey Dyachenko told the Reuters Russia Investment Summit.
Nornickel expects Philippines and Indonesia to be busy building new infrastructure and modern production for some time. “This period will certainly lead to some decrease in market supply and will support the metal price,” Dyachenko said, adding that it usually takes between four and six years to build up new production.
A Reuters poll showed that analysts expect nickel prices to average $9,106 a tonne this year and $10,920 in 2017. “We tend to be slightly more conservative,” Dyachenko said of his company’s view of an $10,000 average next year.
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