Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

French Nickel and ferroalloy producer Eramet predicts the markets will continue with strong momentum in Q2 and the company confirmed its 2021 operating targets.

 

Global nickel demand is expected to continue the recovery that started in Q1 2021, led by Chinese and Indonesian stainless-steel consumption along with strength in electric vehicle batteries.

 

Nickel pig iron (NPI) production in Indonesia is projected to increase during 2021, while traditional producers should recover following issues from 2020 impacted by the COVID-19 pandemic. This will lead to a supply excess this year, with a sizeable price reduction when compared to LME’s class 2 nickel.

 

In New Caledonia, Société Le Nickels (SLN) nickel ore export volume goal is set at over 3.5mn mt in 2021. Considering Q1 production losses, ferronickel production at the Doniambo site is anticipated to stay under 50,000mt.

 

Mine production targets at Weda Bay have been adjusted upwards to over 10mn mt in 2021, and goals for low-grade nickel ferroalloys remains at approximately 40,000mt of Nickel.

 

The miner produced 1.1mn mt of nickel ore in New Caledonia in Q1 2021, an increase of 14pc compared to 918,000mt in Q1 2020 and 433,000mt in Q1 2021 export sales representing a 31pc increase compared to 331,000mt in the prior-year quarter, despite various interruptions.

 

Weda Bay nickel production surged 485pc to 3mn mt in Q1 2021 compared to 513,000mt in Q1 2020 with export sales at 1.2mn mt in Q1 2021. Remarkable mining operations at this location are expected to bring strong cash support to the company in 2021.

 

The company’s consolidated revenue rose 8pc to €838mn ($1.01bn) in Q1 2021, compared to €774mn in Q1 2020. The increase was due to strong growth in the mining and metals section, up 18pc year-on-year, comprised a 9pc increased volume and 9pc growth in prices, even with a 21pc drop in sales in the high-performance alloys division.

 

($1 = €.83)

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