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Nickel prices at near four-month high: Will the momentum continue in near future?

Nickel, which is largely consumed in the stainless-steel industry, now has a greater demand in the very promising electric vehicles battery segment.

July 03, 2021 / 10:33 AM IST
Nickel

Nickel

Signs of global economic recovery and increased industrial demand from the world's largest metal consumer, China brightens the outlook of base metals. Copper, the largely consumed industrial red metal jumped to a record high in LME last month, while other base metals like Lead, Zinc and Aluminium traded well above two-year highs. Nickel prices also gained reasonably.

The bullish trend in LME mirrored in Shanghai and Indian futures markets as well. In MCX, aluminium and copper rallied the most with 22 and 20 percent, respectively since the start of the year. Supply concerns amid higher demand outlook due to recovery in global industrial activities and weak US dollar assisted the sentiments.

Nickel was the frontrunner in the base metal complex in the first two months of the year. It surged to a seven-year high during this period but thereafter corrected sharply on news of a supply deal by a top Chinese company. However, prices managed to get traction on hopes of post-Covid demand recovery.

Nickel, which is largely consumed in the stainless-steel industry, now has a greater demand in the very promising electric vehicles battery segment. This commodity is a vital ingredient for making Lithium-Ion batteries which are widely used to power Electric Vehicles. Since several countries and automakers have already revealed their ambitious targets for EVs, the road ahead for metals like Nickel is bright.