LONDON, Nov 24 (Reuters) – A recognition that electric vehicles (EVs) are unlikely to move the nickel demand dial for some years, slowing demand from China’s stainless steel mills and rising supplies have halted a frenzied price rally and are likely to keep weighing on prices.
Benchmark nickel on the London Metal Exchange soared by 50 percent from mid-June to a two-year peak of $13,030 a tonne on Nov. 1, based largely on expectations of strong demand to make the rechargeable batteries used to power EVs.
Since then the price has eased back to about $12,000. Wood Mackenzie analysts estimate nickel demand in EV batteries will rise to about 220,000 tonnes in 2025 from about 40,000 tonnes last year.
Total global demand of about 2 million tonnes this year is forecast to rise to 2.2 million tonnes by 2025.“Over the next few years the battery sector will not be affected by the availability of nickel supply,” said Anton Berlin, head of strategic marketing at Nornickel, one of the world’s largest nickel producers.
Berlin told an investors’ presentation this week that Nornickel expects the market to remain “fairly balanced” in the longer term and able to supply all the nickel needed, including that for rechargeable batteries, for the next five years.