Presentation: Nickel - The necessity of higher prices [pdf ... - Hatch

METAL BULLETIN 25 TH INTERNATIONAL FERROALLOYS CONFERENCE, 2009
The weakening of the US dollar has helped to drive the Ni price higher
140
Indexed dollar value vs. LME Ni price
$’000/
tonne
60
Effect of $ weakness on Ni prices
Priced in dollars
120
Aug ’04 = 100
50
No US production of Ni
Ni Production in non-$ countries
100
40
Ni Production in countries with ‘floating’ FX rate
80
60
30
Dollar weakness
Falling revenues for Ni producers
Need to increase $ price of Ni to compensate
40
20
Conclusion
20
10
Visible correlation, r = -0.6
Large movements driven more by short-term
market conditions
0
0
Aug 04
Jan 05
Jun 05
Nov 05
Apr 06
Sep 06
Mar 07
Aug 07
Jan 08
Jun 08
Nov 08
Apr 09
Sep 09
$ / RUB $ / CAD LME Ni (RHS)
Source: Oanda, Hatch Beddows
14