Indonesia surprised the mining world little over a week ago putting into effect an outright ban on nickel ore exports, against expectations of a last-minute climb down by authorities.
Indonesia accounts for around a fifth of global supply at an estimated 400,000 tonnes of contained metal and the ban was seen as a potential game changer in the market for the steelmaking raw material..
Nickel prices have reacted in a fairly subdued manner however with three-month nickel on the LME last trading at $14,650 a tonne. That’s up around 7% since the ban was implemented, but a far cry from 2013’s high of $18,700 struck in February and still near levels last seen in 2009.
Global warehouse levels have risen sharply over the past two years – hitting a record 260,000 tonnes this year according to LME data – keeping prices subdued. Ample available metal and ore combined with a 20% rise in worlwide mining output since 2011 just as the market was moving into surplus.