France's Eramet sees a global nickel deficit in 2015-2017 if Indonesia strictly adheres to its policy of banning exports of unprocessed nickel, Bertrand Madelin, CEO of Eramet Nickel said Thursday.
Speaking at a company news conference in Tokyo, Madelin said China's port stocks of nickel ore are likely to run low at the end of this year, and the world will run "a slight deficit" of nickel after a 150,000 mt of surplus in 2013.
China's stocks are running low due to Indonesia banning unprocessed nickel exports in January.
"We could have a real deficit in 2015. If Indonesia's ban on unprocessed nickel exports is strictly implemented and if the Philippines has a similar ban policy, the world will be in deficit in 2015, 2016 and 2017.
After that, there will be new projects," Madelin said.
Nickel on the London Metal Exchange averaged at $6.64/lb in the first quarter of 2014. This week, it traded above $8/lb. Falling nickel ore stocks in China are helping to boost nickel prices, Madelin said.
"Currently Philippine nickel ore [exported to China] trades at $100/mt, which is equivalent to nickel price of $10/lb," Madelin said.
Eramet CEO Patrick Buffet said the recent rise in the price of nickel "is not sufficient to launch projects. We need more than $10/lb."
Madelin put the ideal price range for nickel at $10-12/lb. "Not too much [in price rise] or steel mills will start to increase production of ferrite stainless steel [that does not contain nickel]," he said.
