Demand up. Supply down. Price heading for a 10-year high. It doesn’t get much better for nickel—except for the potential to get a lot better for a metal which has a well-earned reputation for extreme highs (and lows).
Since suffering a Covid-19 collapse last March when the price fell to $10,800 a ton, nickel has been on a largely uninterrupted rise to last sales at $18,244/t, up almost 70% in 10 months.
Next target for nickel, which is a critical ingredient in high quality stainless steel and the batteries used in most electric vehicles (EVs) is $20,000/t, a level reached in the early 2012.
But, if a move back to levels seen in the last commodities boom sounds unlikely, then get ready for a rise to the great nickel rush of 2007, when the metal hit an all-time high of $50,000/t—before plunging to $9,200/t just two years later.
What sent nickel through the ceiling 14 years ago was a combination of supply shortages and strong demand for stainless steel. This time around, nickel has a new price driver, EVs, a mode of transport which was not even a blip on commodity investors radar screens in 2007.