The global nickel market surplus in 2022 will be 109,000 tonnes, and this volume will be entirely accounted for by low-grade nickel, according to the forecast of Russian miner Nornickel, Kallanish notes.

The nickel market has continued to attract a lot of attention over the course of 2022. This has been caused not only by the extreme volatility of the nickel contract prices in March, which led to the suspension of LME nickel trading and an unprecedented decision to cancel trades, but also by a significant transformation of the nickel industry over the last few years, it claims.

“The nickel market, which had been divided into the low-grade and high-grade segments, became interconnected once the practical implementation of the nickel pig iron-to-matte conversion in early 2021 along with the ever-growing high pressure acid leach (HPAL) capacities became the new essential reality of this market,” Nornickel observes. “Historically, market surpluses have been linked to the London Metal Exchange deliverable/Class 1 nickel, but in 2022-2023, the surplus will be mainly represented by the low-grade nickel units, particularly nickel pig iron (NPI) and ferronickel (FeNi), while the high-grade nickel market is expected to be relatively balanced.”

Since the company's last report, it has revised the 2022 market surplus upwards to 109,000 t, mostly in low-grade nickel, primarily due to lower-than-expected stainless steel output globally, resulting in significant discounts for low-grade nickel and accumulation of NPI and FeNi stocks, the company adds.

According to the company's expectations, nickel consumption will grow to 3.08 million tonnes this year and up to 3.34mt in 2023. In 2021, the result was at 2.8mt. At the same time, deliveries will amount to 3.19mt for this year and 3.45mt in 2023. In 2021, it was 2.7mt.

Nornickel saw January-September nickel production increase to 159,200 t, up by 23% on-year.