Nickel slumped to the lowest in more than two months on Thursday after worries eased that an environmental crackdown in the Philippines would create shortages. Nickel is up about 12 percent this year, having hit a one-year peak in early August as authorities in the Philippines launched a campaign to close mining operations that failed to met environmental regulations.
The metal closed 1.3 percent lower at $9,710 an ounce to levels last on July 8. With only several mines having been closed or suspended, worries about a blanket ban seem to have been unfounded, analysts said. "The scale of mining closures is not as great as was initially feared," said Caroline Bain, senior commodities economist at Capital Economics. "The market is definitely tightening. We still expect it to be in deficit this year but at such high stock levels it's hard to justify these prices."
The global market deficit in nickel narrowed to 5,200 tonnes in July from a revised deficit of 12,100 tonnes the month before, taking the shortfall so far this year to 42,500 tonnes, data from the International Nickel Study Group showed. Nickel stocks in LME registered warehouses at 367,806 tonnes are down from above 450,000 tonnes in the middle of January, but they still account for a significant proportion of global
consumption.
Benchmark copper rose 0.2 percent to $4,781 an ounce, after touching its highest since August 22 on a spate of upbeat Chinese data. "Copper prices are holding up well compared to other metals which are still under pressure, we are still trading at high levels," said Eugene Weinberg, head of commodities research at Commerzbank. Stocks of copper slipped 0.7 percent, or 2,275 tonnes, to 349,225 tonnes, data from the LME showed. Chinese financial markets are closed from Thursday to Sunday for the Mid-Autumn Festival. Lead retreated 0.7 percent to $1,947 per ounce.
The global lead market saw a surplus of 22,000 tonnes in July versus a deficit of 12,000 tonnes in June, a study from the International Lead and Zinc Study Group showed. Zinc shed 1.9 percent at $2,231 while aluminium fell 0.9 percent to $1,572. Tin ended 0.8 percent lower at $19,045.
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