Nickel Forecast Raised by Credit Suisse on Stainless Steel Use
By Jae Hur
(Bloomberg) -- Nickel cash prices may average
higher than forecast this year as stainless steelmakers resume
purchases, Credit Suisse Group said.
Nickel may average $17.97 a pound ($39,617 a metric ton),
up from a previous estimate of $15, analysts including Jeremy
Gray at the bank said in a July 6 report. The metal has averaged
$19.91 so far this year.
Spot nickel has fallen 40 percent from a record in May as
stainless steel producers used less nickel or cut output. Credit
Suisse expects nickel prices to rise in the fourth quarter.
``We estimate global stainless steel output to increase
approximately 5 percent in 2007 and 6.6 percent in 2008,'' the
analysts said. They expect nickel demand to gain next year on
increased usage in batteries and the aerospace industry.
Nickel for immediate delivery fell $1,750, or 5.1 percent,
to end at $32,805 a ton yesterday. The price reached the record
in May as stockpiles plunged to an amount equal to less than two
days of global consumption following strong demand in China.
Credit Suisse also raised its 2008 nickel forecast by 36
percent to $15, 2009 by 38 percent to $11 and 2010 by 33 percent
to $8. These compare with estimates by Jon Bergtheil, head of
global metals strategy at JPMorgan Securities Ltd., made on July
8, for $17.95 pound in 2007, $12.48 in 2008, $8.51 in 2009 and
$6.45 in 2010.
``We estimate a finely balanced nickel market through until
2009, with marginal surplus supply (of) refined nickel estimated
at 1 percent of global consumption in 2007-2008,'' the analysts
said.
To contact the reporter on this story:
Jae Hur in Singapore at
[EMAIL PROTECTED]
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