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Norilsk Nickel expects to increase the value of production in 2014

5 August 2013

According to experts of MMC «Norilsk Nickel» — the largest manufacturer of Ni in the world — the price of the metal could rise in 2014, after the adoption of Indonesia's ban on the export of raw ore of this resource.

Recall that Indonesia today — the world's largest exporter of nickel laterite ore, which is mostly used by Chinese manufacturers as a cheap replacement of refined nickel with stainless steel manufacture.

According to Pavel Fedorov statement (Deputy General Director of «Norilsk Nickel»), made after talks with the Indonesian government and industry representatives in Jakarta, if the veto cited above will be strictly adhered to, the demand for refined nickel will be able to maintain at a high level.

Pavel Fedorov also believes that the uncertain political situation at present prevents receive proper investment and destabilize the nickel market. And even «almost passed ban 'on the export of ore from Indonesia can not influence the situation, as many experts believe: the infamous veto will not be accepted, either as is defined above by the Government of the terms of the country (until January 2014) observed a lack of rigor.

Whatever it was, analysts say that even with the most positive developments in Indonesia, rapid change is not worth waiting in the nickel sector. For example, according to Maxim Sokolov, a member of the board of directors of «Norilsk Nickel» in the current economic situation, many industry actors operating at a loss, and even in the event of a significant reduction in the Indonesian ore export volumes closure of the plants would still be inevitable.

Previously reported: Export lateritic nickel ore from Indonesia for the first five months of 2013 reached a volume of 24.4 million tons, which is 30% higher than the figure for the same period of 2012… This is due to the fact that businesses that develop the bowels of the state, in anticipation of the adoption of the ban increased the supply of nickel raw materials to the maximum.

Recall that now the three-month contract price of nickel on the London Metal Exchange fell to its four-year low — level of 13.9 thousand USD per ton (compared to 21.0 thousand USD per ton in January 2012)… The growth rate of the Chinese economy are falling, which is why manufacturers of stainless steel — as an alternative to the old suppliers — have increasingly resorted to purchasing cheap raw materials from the Philippines and Indonesia.

Many analysts believe that the Indonesian authorities did not want to introduce a full and uncompromising ban on the export of nickel laterite ore from the country. «That will not happen, as a sharp outflow of money nickel can cause significant damage over the country's economy» — comment on what is happening commodity market experts.

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