Mad soaring nickel
The London metals market on Tuesday suspended the quotation of nickel, whose price, which had already broken its record on Monday due to fears over Russian supplies, climbed briefly Tuesday morning above 100,000 dollars per ton. Russia is, along with Indonesia, the Philippines, New Caledonia, Australia and Canada, one of the main producers of nickel.
“Following further unprecedented increases in the three-month nickel price overnight, the LME has taken the decision to suspend trading, at a minimum, for the remainder of the day. [de mardi] », the London Metal Exchange said in a statement. At the start of the year, the price was still just over $20,000.
While all metals have been on the rise since the beginning of the week, nickel is used in the design of stainless steel, but is also present in the batteries of electric vehicles, which has boosted its demand in recent years.
The sharp rise in the price of nickel since the start of the conflict due to the importance of Russia in the production of the metal has triggered a movement of forced liquidations of short sales, commented Jim Reid, an analyst at Deutsche Bank.
Speculators who bet on a drop in the price of nickel are now forced to buy the metal to close out their position and meet the terms of their contract, artificially driving up prices and forcing other downside bettors to likewise. In this kind of scenario, “given the lack of market volume, there is no limit to the level that prices can reach”warn Marex brokers.
Result, in three sessions, the price soared by 197%, to 80,000 dollars per tonne, when the LME suspended trading on Tuesday.