Metals: Nickel under pressure

• Nickel continues to trade under pressure this year after slumping more than 40% in 2023 as increased supplies from Indonesia have raised concerns over a global supply glut. Lower prices have been prompting miners to cut back on supplies. Wyloo Metals Pty Ltd., owned by Andrew Forrest, said it’s shutting down mine operations in Western Australia from 31 May due to the prolonged weakness in the nickel market. As a result, parts of BHP’s Kambalda concentrator will also be suspended starting in June because they can no longer receive ore supply from Wyloo’s halted mines.
• Recent numbers from the International Aluminium Association (IAI) show that the average daily global primary aluminium output was flat at around 194.9kt in December, compared to 195kt reported a month earlier. Total monthly output rose 2.1% year-on-year (+3.3% month-on-month) to 6.04mt last month, following improved production levels from almost all major producing countries. Meanwhile, cumulative aluminium production rose 2.3% YoY to 70.6mt for the full year 2023. Similarly, Chinese output is estimated to have increased 2.4% YoY (+3.3% MoM) to 3.57mt last month, while year-to-date production is seen rising by 3.1% YoY to 41.7mt in Jan’23-Dec’23. Production in Western and Central Europe also recovered 3.1% MoM to 231kt in December, while year-to-date output still declined 6.9% YoY to 2.7mt last year. Meanwhile, aluminium production in Asia (ex-China) rose 2.6% YoY to 401kt in December.
• The International Copper Study Group’s (ICSG) latest update shows that the global copper market remained in a supply deficit of 119kt in November. Meanwhile, the Group estimates a total deficit of 130kt over the first 11 months of the year amid subdued mine production and higher demand (particularly in China). Global mine and refined copper production increased by 1% YoY and 5.5% YoY, respectively, while overall apparent refined demand increased by 4% YoY over the first 11 months of the year.