Bloomberg | May 17, 2024
The South Pacific archipelago has been wracked by violent protests this week due to a change in voting rules. (Image: Screenshot via ABC News YouTube.)
Nickel jumped more than 5% — the most in a month — as unrest in New Caledonia raised concerns about further disruption to supplies from the French territory.
The South Pacific archipelago, which was the world’s third-biggest producer of the electric vehicle battery metal last year, has been wracked by violent protests this week due to a change in voting rules. That’s disrupted output from French miner Eramet SA, which is running its local unit at minimum capacity.
Nickel futures rose as much as 5.7%, the biggest intraday gain since April 15, on the London Metal Exchange. They were trading up 5.5% at $20,880 a ton as of 8:07 a.m. in the UK capital. Other base metals also rallied, with aluminum and copper adding 1.1%.
New Caledonia’s nickel output had already been slashed after prices plunged amid faltering consumption by the battery sector and a boom in Indonesian supply. Since then, delays to mine licensing in the South East Asian nation and sanctions on Russian metal have helped push prices on the LME back above $20,000 a ton for the first time since September.
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“Nickel is playing catch-up gains” with other base metals, said Gao Yin, an analyst at Horizon Insights. “The New Caledonia incident is adding a bit of disruption to the nickel market, which is also fueling the price rally further.”
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