Experts differ over 2022 outlook for nickel

Commodity experts are not in agreement about where nickel prices are heading this year, says Roland Mauss of recycler Oryx Stainless, himself an expert on stainless steel scrap. In his monthly blog on Oryx Stainless, Mauss says Chinese researchers are playing down the growth potential, while others predict a super-cycle.

Chinese state-owned research institute Antaike forecasts falling prices as soon as the global economy has recovered from the pandemic. It expects that nickel supply will grow by 12% this coming year, while demand will rise 10%. Therefore, Antaike forecasts excess supply of 45,000 tonnes of nickel.

In contrast to this, US investment bank Goldman Sachs argues the other way round, that the recovery from the Covid-19 pandemic as well as global economic measures will boost demand in the long run. It will also be driven higher by the energy transition and global decarbonisation efforts, Kallanish understands.

This view is supported by asset manager BlackRock, which states that infrastructure spending is driving a lot of steel and cement demand, and that decarbonisation will require additional metals such as nickel.

Finally, Mauss takes a look at a survey taken by Reuters in October among analysts of leading commodity brokers regarding the average price of nickel. For 2021, the participants expected an average nickel cash price of $18,195/tonne (after $13,772 in 2020). The actual cash average year-to-date through October was around $18,170/t.

“It does, however, become more interesting for the year 2022,” he continues. The participants expect only a minor further increase due to a shift in the supply and demand ratio. While for 2021, a supply deficit of 62,000t was assumed, they expect excess supply of 72,000t for 2022 – higher than the forecast of China’s Antaike institute.

Christian Koehl Germany