LONDON, May 20 (Reuters) – The London Metal Exchange (LME) nickel market was last week gripped by the most acute tightness in a decade. Time-spreads flexed into backwardation as a long-running downtrend in exchange stocks squeezed short position holders.
Falling inventory and tighter spreads are normally strong bull signals in a commodity market. And in nickel’s case they seem to tally nicely with the International Nickel Study Group’s (INSG) forecast that supply will fall short of usage for the fourth successive year in 2019.
However, conspicuous by its absence is any strength in the outright nickel price, which has fallen from a March high of $13,765 per tonne to a current $11,910. Continue Reading →