TOKYO, Dec 25 (Reuters) – A global nickel market deficit will nearly halve to 49,000 tonnes in 2019 from 93,000 tonnes this year on higher output of primary metals by global suppliers and of lower-grade nickel pig iron (NPI) in Indonesia, Sumitomo Metal Mining said on Tuesday.
Sumitomo Metal, Japan’s biggest nickel smelter, said global demand for nickel is seen increasing by 3.4 percent in 2019 from this year to 2.339 million tonnes, while supply is expected to climb 5.5 percent to 2.29 million tonnes.
“We expect to see higher demand for stainless steel and rechargeable batteries next year,” Masanori Ohyama, general manager of Sumitomo Metal’s nickel sales and raw materials department, told reporters.
Nickel is mainly used in stainless steelmaking, but is also a vital ingredient for the lithium-ion batteries used to power electric vehicles, where demand is set to accelerate over coming years.
“As for supply, we expect an expanded production of NPI in Indonesia and a pick-up in output from class I producers,” Ohyama said, referring to the producers of high-purity metal with more than 99.8 percent nickel content. NPI usually has less than 12 percent nickel content.