Three-month nickel on the London Metal Exchange (LME) was on the rise Wednesday and Thursday following Indonesia's reaffirmation of its ore export ban, as well as concerns about an ore shortage in China. The base metal's gains began after Bambang Adi Winarso, senior adviser to Indonesia's coordinating minister for economic affairs, said Wednesday that the country's ban on unprocessed ore exports will stay in place. Specifically, LME nickel for delivery in three months rose $134 to hit $16,279 per metric ton (MT), as per Bloomberg. It might seem odd that comments about the ban had an effect on the nickel price — after all, it's been in place since January — but given that some market participants have speculated that the country will not retain it, any confirmation that it will stay is important. As mentioned, nickel's positive price run continued Thursday. At that time, three-month LME nickel jumped to $16,380 per MT, its highest since October 15, later dipping back down to $16,217, according to Reuters.
Pushing the metal up was news that Chinese stainless steel producers, which are currently importing lower-quality ore from the Philippines "to supplement their stockpiles," may ultimately run short of the material. Joel Crane, a Melbourne-based Morgan Stanley analyst, told Reuters, "[t]he chances of a supply gap are fairly high," though he added, "I don't think it's going to be as acute as consensus price forecasts suggest." More gains to come? Nickel has had a topsy-turvy year thus far. Though Bloomberg notes that it's up 16 percent for the year, the metal has slumped from the highs it hit earlier in 2014, when the Indonesian ban was fresher and the Philippines was talking about implementing a similar ban. As a result, it's tough to say what's next for the metal.