Nickel On MCX Settled Down -0.37%

Nickel on MCX settled down -0.37% at 593.2 as pressure seen after Indonesia allows another new company to export nickel ore. Pressure also seen on prices on plentiful supply from Indonesia and the Philippines. Indonesia allows PT Ceria Nugraha Indotama will be permitted to export 2.30 million tonnes of nickel ore in principle through to July 2018. Nickel prices have been erasing the gains they experienced in 2016 amid constrained supplies.

In 2017 the supply situation has gone through a rapid reversal as the Indonesian government relaxed regulations that previously banned nickel ore exports while Philippine nickel miners are positioned to restart operations with a new acting environment minister. While the two countries are increasing their nickel exports, other nickel miners are starting to review low performing assets.

According to Reuters, Brazil’s Vale is reassessing its loss-making New Caledonian nickel operations after new Chief Executive Fabio Schvartsman took charge last month. With nickel trading around $9,000 a ton, many nickel operations are running at a loss. Further complicating the situation, it does not seem likely that prices will recover anytime soon with Indonesia just starting to ramp up exports, while Philippine nickel production should soon follow. Technically now Nickel is getting support at 588.3 and below same could see a test of 583.4 level, And resistance is now likely to be seen at 598, a move above could see prices testing 602.8.

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Suhani Verma

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