Nickel - the metal for 2007?

[BREND]

Well the Hedge funds have speculated it so far that a fall from 50k makes January's levels of 35k ish look cheap....a fact the Chinese will have to lump and probably will at those levels....who would have thought hey!.
Brend I seem to recall you recommending to your clients to short at 37k, hope they covered.

Anyway you look at it, Nickle producers are in an enviable position mid term, I wouldn't count on HPAL'S coming online smoothly.

Freeballing, yes, covered back already.

Recently our team recommended clients to sell Nickel Call option $52,000 Apr 07, premium for 1 lot of nickel is USD4,350, so yield is 16% in just 2 weeks time. Expiration of option is on 4 Apr 07.

 

[BREND]

Currently nickel seems to be trading at the peak of an uptrend channel, so it is likely that it will face some resistance moving upwards this month.

Current price is trading at $49500/ $50000, you can sell a call option, strike $60,000, May 07 (expires in 2 May 07). Premium received is USD250/ton, so selling 1 contract, the premium received is USD250 x 6 = USD1500. Yield is 5.88%/mth.

http://basemetal-trading.blogspot.com/2007/04/selling-nickel-call-option.html

 

[Sodapop]

Looks like there is still plenty of Ni Sulphides around - just need to be found!!! A coy in Canada (looking for diamonds no less) claims to have found a decent deposit... Voisey's bay was also found by a company looking for diamonds and now is one of the premier NiSu mines in the world... So for those people who say that there is no NiSu remaining... well - it's there just have to find it... Cause i am very cynical about any of these countless minnows spruiking Laterite deposits ever getting off the ground when it is probably far more productive (with a higher probablility of long-term success) to look for the sulphides - look at WSA, Mirabella, et al - all relatively recent Sulphide discoveries listed on the asx...

http://www.canada.com/nationalpost/...85148-64b9-4138-86ae-5c264aef0d1f&k=83915&p=2

 

[brerwallabi]

This report from Wilsons and the comments from Chip Goodyear I found interesting.

Mineral exploration expenditure in Australia for 2006 increased 199% since 2003. Strong growth occurred for expenditure in iron ore (431%), coal (235%), uranium (907%) and the base metals (317%) being comprised of: copper (514%), silver-lead-zinc (339%) and nickel-cobalt (210%).

Expenditure for gold exploration increased just 115%, for mineral sands (119%) and for diamonds (101%). These latter increases are significant, but pale in comparison with the growth in expenditure on the other commodities. With acceleration of expenditure and activity on the scale. It should be no surprise that the industry is experiencing shortages in manpower and materials.

BHP’s CEO Chip Goodyear said prices of copper, nickel and other metals will remain high for several decades as demand from China and India climbs. “I'm excited about what we'll see over the next several decades as 2.5 billion people in China and India and other parts of the developing world enter the world economy,'” Goodyear said this week in Santiago. “Is China and India the next reason for a multi-decade increase in commodity prices? We're positive about that.'”

 

[imajica]

From The Times
April 6, 2007


Nickel prices reached $50,000 (£25,400) per tonne for the first time yesterday, having risen by 50 per cent in three months.

Prices for the metal, which is used to prevent corrosion in steel, have soared because of a shortage of supplies and rising demand from China and India.

On the London Metal Exchange (LME), nickel for three-month delivery reached $50,000 in early trading as traders worried over stockpile shortages. The price fell back to $49,700 by the close of trading, still up 2.3 per cent on the previous day. The price of nickel was $33,000 at the start of January and just $13,000 in January 2006. The demand has emptied warehouses with stocks falling to below 5,000 tonnes from almost 30,000 a year ago.

Commodities analysts at Barclays Capital said yesterday: “The low level of stocks highlights the market’s vulnerability to supply disruptions which have plagued the nickel market and been a key factor behind the sustained rally in price.”

Although demand for steel and nickel is set to ease in the US this year, most analysts believe that strong growth in Asia will continue to put pressure on supply. Dresdner Kleinwort said: “The market has recognised that US demand might decrease due to a slower pace of economic activity but that demand from emerging economies, especially China, will more than offset any possible shortfall from the US.”

Xstrata, which bought Canadian nickel producer LionOre for £2 billion last week, and Russia’s Norilsk are the main beneficiaries from this surge in prices. Lead also hit a record yesterday of $2,025 per tonne on the LME. Copper was $7,465, its highest level since last October.

 

[rederob]

imajica
It was actually the "3 month" forward price that tipped the scales over $50k.
The spot price got there a few weeks ago.
As much as I like the high price (as a holder of nickel equities), it's getting closer to a technical blow-off and I would not be jumping on to the bandwagon at these crazy levels.
Although, buying back in around $40k may not be the extreme danger it was just a month ago.
Those that sold MRE down so heavily on Thursday will wonder if it was the right move - but taking a profit seldom is when a share is clearly overbought.

 

[rederob]

Monthly nickel prices presently (at around $22) are averaging over 3 times the annual 2005 price of $6.69 and twice the average of 2006 ($11.01).
All the price dips are being bought into.
There is no "spare" nickel sloshing around.
Oz Nickel producers will overshoot analyst estimates yet again.
This is a long term trend that keeps catching the market by surprise.
Sure uranium shares are going through the roof, but my feet are comfortably on the ground, and I can let the market roll on without having too many concerns.

 

[bigdog]

Who are the key Nickel companies on Aust Stock Exchange?

 

[reece55]

Who are the key Nickel companies on Aust Stock Exchange?

Big Dog

BHP (obviously!)

JBM
IGD
MRE
MCR

Those are the ones that come to mind in the ASX 200....

Cheers
Reece

 

[chops_a_must]

IGO rather.

SMY is there as well isn't it?

AGM and VRE will both be producers by the end of this year as well.

 

[michael_selway]

IGO rather.

SMY is there as well isn't it?

AGM and VRE will both be producers by the end of this year as well.

JBM
MRE
SMY
IGO
MCR
LIM
AGM
thx

MS

 

[Freeballinginawetsuit]

IGO rather.

SMY is there as well isn't it?

AGM and VRE will both be producers by the end of this year as well.

Chops,

ALB is worth a look as well.

1st entry hurdle at $2.10ish........ a bit of patience should enable accumalation in this one near term IMO.
Similar production timeframe as AGM.

Sound fundamentally/low cost production and a decent sulphide resource with scope for further upgrades.

Gate offtake with Jinchuan for life of mine.

LOL ........another Miner out of Colin street in West Perth, I'm sure they all do lunch together and compare thier success at mining shareholders....... on thier hip pockets!

 

[mildew79]

would want to bounce from here..........watch your fingers and toes.

around 10 percent fall to next support

 

[happytown]

This should come as no surprise (from the Australian),

Posco's no-nickel steel

Kevin Andrusiak

April 27, 2007

GIANT South Korean steelmaker Posco has joined a growing band against the surge in nickel prices, and has introduced its own nickel-free stainless steel product.

Posco is yet to give a proper name to the new product that substitutes chromium for nickel, labelling it as POS445NF. It claims it will sell 120,000 tonnes next year, about 6 per cent of its stainless steel sales.

Posco is the world's fourth-biggest steelmaker with stainless sales of about 2 million tonnes a year.

The new product, in development for two years, has the same rust resistance as that of 304 stainless steel, which accounts for about 70 per cent of Posco stainless steel sales and more than 50 per cent of global production.

Posco says the price for POS445NF would be more than 50 per cent cheaper than 304.

Stainless steel usually has a minimum of 8 per cent nickel.

cheers

 

[chops_a_must]

Posco is yet to give a proper name to the new product that substitutes chromium for nickel

Bahahahahaha!

I'll have a cutlery set with a side of cancer please.

 

[Wysiwyg]

This article I found while looking at Norilsk (inquisitive about their 20% holding in Lionores Black Swan W.A.) suggests that higher production costs will narrow profit margins.Though the bottom line where the company (Norilsk) plans to outlay a billion/year and other articles say the demand is insatiable.The `in between` player (hedge fund man) always likes his cut. Hope this helps with longer term optimism.

I made this comment back in January and well I can`t believe it , they WANT ALL of Lionore. If only I had enough funds to spread around.

"Norilsk Nickel will offer to purchase all of the issued and outstanding common shares of LionOre at a price of Cdn$21.50 in cash for each LionOre common share. Assuming that all common shares are tendered into the offer, total cash consideration of approximately Cdn$5.3 billion will be offered.

The cash offer represents a premium of approximately 22.9% over the closing price of Cdn$17.49 per LionOre common share on the Toronto Stock Exchange on March 23, 2007, the last trading day prior to the announcement of the intention of Xstrata Canada Acquisition Corp. (“Xstrata”), a wholly-owned subsidiary of Xstrata plc, to make an offer for the LionOre common shares. The Offer also represents a premium of approximately 16.2% over the Cdn$18.50 price per LionOre common share offered by Xstrata".

 

[dj_420]

hey guys just wondering who the next nickel producers will be in australia?

i have so far

AGM



thanks in advance

 

[dj_420]

or i would even appreciate some people letting me know about their fav nickel companies and WHY? ie resource size etc.

i am looking for a good nickel company that is close to production, and sp has not gone through the roof yet.

cheers guys

 

[chops_a_must]

or i would even appreciate some people letting me know about their fav nickel companies and WHY? ie resource size etc.

i am looking for a good nickel company that is close to production, and sp has not gone through the roof yet.

cheers guys

I've done a fair bit of work on VRE. It's all in that thread. Although primarily a gold miner (awaiting ann of first gold pour), they have a JV with MCR and have said they will be mining nickel by the end of the year. All the press releases and the broker report is there. Currently sitting on its NPV, and consolidating awaiting BFS (any day) and ann of first gold pour.

Cheers,
Chops

 

[kr1zh]

Metals - LME inventory data (Friday)

Copper down 1,775 tonnes at 142,275 tonnes
Nickel up 252 tonnes at 4,698 tonnes
Zinc up 400 tonnes at 87,100 tonnes