Australian (ASX) Stock Market Forum

NIC - Nickel Industries

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@Boggo Timely chart post re NIC. Well done, you've still got it. :xyxthumbs

So what happened today? NIC open high at 1.75 and closed below 1.50 !
Surely (don't call be Shirley), that selloff has got to be oversold.

I'm aware that NIC produces nickel from laterite, not as cheap and clean as the Ni-sulphide but it's still nickel. With Russia (15-20% world prod'n) out of favour, NIC has got to be better off in the short to medium term because of the outrageous rally in price of nickel.
 
peter2 said:
@Boggo Timely chart post re NIC. Well done, you've still got it. :xyxthumbs

So what happened today? NIC open high at 1.75 and closed below 1.50 !
Surely (don't call be Shirley), that selloff has got to be oversold.

I'm aware that NIC produces nickel from laterite, not as cheap and clean as the Ni-sulphide but it's still nickel. With Russia (15-20% world prod'n) out of favour, NIC has got to be better off in the short to medium term because of the outrageous rally in price of nickel.
Click to expand...

I’m away from home in the SE of SA until next Sunday.
Marginal phone coverage in this location but enough to see a lot of red numbers !
Looks like the nickel and lithium etc sectors finally succumbed to the overall sentiment.
 
Yes, I read something about a Chinese firm holding short nickel positions when the nickel price hit $100 and the future's exchange halted trading. The report did mention that the firm was given extra time to pay the margin due to the exceptional circumstances.

However that was last night, the NIC selloff started yesterday with other commodities falling also. It's still worth a "please explain" though.
 
Wondering if NIC's crash over the last few days is related to news below, IGO is bouncing up today...

Now we are hearing a Chinese nickel player is facing huge losses on shorts its carrying – the last few days has seen an almighty squeeze on the upside which is undoubtedly destroying someone’s balance sheet. These panic style moves are rarely sustainable medium-term but obviously anything’s possible day to day, interestingly yesterday saw major local nickel producer IGO Ltd (IGO) reverse panic like strong early gains to close down on the session.
  • On Tuesday The London Metal Exchange (LME) was forced to halt nickel trading, and cancel trades, after 3-month nickel more than doubled to over $US100,00 – somebody was clearly “short and caught” as the saying goes.
It would appear China’s Tsingshan Holding Group was forced to cover short positions as prices rose sharply as supply concerns intensified after Russia’s invasion of the Ukraine – sounds very expensive!
 
Report from Bloomberg.
nic0903.PNG
 
peter2 said:
Report from Bloomberg
Click to expand...
What's the connection with NIC though? Soaring Nickel prices should be a positive unless NIC has also been shorting Nickel on the LME? This would seem to be the best explanation for NIC's share price tanking but can't find any disclosure on this as yet.

Hmm, NIC trading now paused on the ASX pending an announcement, sounds ominous.
 
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NIC operates in partnership with Tsingshan. Tsingshan owns 19% of NIC.

If Tsingshan is shutdown, NIC is in trouble.
 
Is NIC a good falling knife buy? It's times like this where fortunes are made and lost IMO.
 
I think it depends on your view of laterite nickel.
Musk has said he is not interested, but Indonesia intends to be a player in the entire EV value chain.
These prices will abate in time and Tsingshan is not going anywhere, not with the contracts already written with some big players.
 
sptrawler said:
Is NIC a good falling knife buy? It's times like this where fortunes are made and lost IMO.
Click to expand...
Need more information, if the selling pressure is mainly Tsingshan dumping NIC shares to meet margin calls then of course deep value would emerge given the current nickel price.

1646786806107.png
 
NIC halted down 33%, then resumes trading later in the day to finish down 4.75%! Wild ride and some serious upside for those who bought into the crash in the morning. Their ASX response obviously calmed the market...

The Company acknowledges recent press speculation regarding a short position in LME nickel held by Tsingshan group and the implications this had had on global nickel markets. The Company notes following discussions today with personnel of Tsingshan and its affiliate Shanghai Decent (‘Tsingshan’):

• the Company’s operations at the Hengjaya Nickel and Ranger Nickel projects are unaffected, as is commissioning at the Angel Nickel project and construction at the Oracle Nickel project.
• Tsingshan have firmly assured the Company that they have no intention of selling any shares that it holds in the Company.
• there has been no change in Tsingshan’s irrevocable undertaking to purchase all of the nickel pig iron produced by the Company’s RKEF operations.
• there has been no impact on Tsingshan’s intention to receive Nickel Mines shares in the Conditional Placement as detailed on 9 February 2022 as part consideration for the Company acquiring a 70% interest in the Oracle Nickel Project.
• Tsingshan remains the world’s largest stainless steel and nickel producer with its operations generating revenues of 352B RMB (US$~$56B) in 2021. Tsingshan’s operations remain robust and unaffected with the Group having strong confidence in its ability to manage its current market position.
 
If all this is just a trading blunder then this represents an incredible buying opportunity, IF the underlying basis of it's MC have not changed in the past three days. But, I have not been following and don't know a thing about NIC. Looks like others are buying the sell-off too.

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