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

Nickel and ferroalloys producer Eramet targets to export more than 3.5mn wmt of nickel ore from its mines in 2021.


The miner expects its ferronickel production from the Doniambo plant in Indonesia at around 50,000mt by the end of this year, while nickel production at its Weda Bay mine is projected at 6mn wmt.


However, the challenges being faced by the aerospace industry will continue to impact Eramet’s high-performance alloys division. The company expects air traffic to return to pre-crisis levels only by 2024, a sentiment shared by aircraft manufacturers who have adjusted their production down accordingly.


Revenue for the alloys division is expected from the automotive market where global production may increase in 2021.


The French nickel miner indicated growth in its profitability in its earnings report on Tuesday. Eramet expects its EBITDA to grow to around €600mn ($726.91mn) this year, based on expected higher demand in H2 2021 and higher LME nickel prices that are estimated at an average of $7.50/lb.


In 2020, the company said it had achieved all its production targets for the mining and metals division, though its high-performance alloys division performed below expectations. 


In the metals and mining division, the nickel business’ production grew in New Caledonia by 16pc to 5.4mn wmt last year, compared to 2019. Nickel ore exports also increased by 55pc to 2.5mn wmt in line with the guidance, Eramet indicated. The Weda Bay mine’s ramp-up during the year helped the company produce close to 3.4mn wmt of ore in 2020 after it began operations in the previous year.


The company produced 48,000wmt of ferronickel in 2020, flat from the previous year, despite the grade’s sales growing by 7pc to 50,000mt.


The nickel division’s revenue grew to €905mn in 2020, up 16pc from €778mn in the previous year. Revenue from the high performance alloys division dropped by 20pc to €680mn from €847mn in the same timeframe. 


The group’s consolidated turnover fell by 3pc to €3.5bn in 2020 on an annual basis, while its EBITDA dropped by 37pc to €398mn last year from €630mn in 2019.



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