ECA review of development trends in the nickel industry (1980-1988) and prospects for the 1990s

(1)

KRD/MES/5/89 (a)

ECA REVIEW OF DEVELOPMENT TRENDS IN THE NICKEL INDUSTRY

(1980-1988) AND PROSPECTS FOR THE 1990S

ECA/MULPOC/LUSAKA OCTOBER, 1989

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TABLE OF CONTENTS

PAGE

INTRODUCTION 1

SUMMARY OF REVIEW 2

WORLD NICKEL RESOURCES AND RESERVES 4

MINE PRODUCTION OF NICKEL 5

INTERNATIONAL TRADE IN NICKEL ORES, CONCENTRATES,

OXIDES, MATTES, SINTERS, ETC. 9

INTERNATIONAL TRADE IN NICKEL SCR .P 14

WORLD INCKEL SMELTER/REFINING PRODUCTION 19

INTERNATIONAL TRADE IN REFINED NICKEL METAL

INCLUDING ALLOYS 23

WESTERN WORLD STOCKS OF NICKEL 29

REFINED NICKEL CONSUMPTION 31

NICKEL PRICES 34

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LIST OF TABLES

PAGE

1. WORLD NICKEL MINE PRODUCTION 7

2. WORLD EXPORTS OF NICKEL ORES, CONCENTRATES, OXIDES,

MATTES, SINTERS, ETC. 10

3. WORLD IMPORTS OF NICKEL ORES, CONCENTRATES, OXIDES,

MATTES, SINTERS ETC. 12

4. WORLD EXPORTS OF NICKEL SCRAP 15

5. WORLD IMPORTS OF NICKEL SCRAP 17

6. WORLD NICKEL SMELTER/REFINING PRODUCTION 21

7. WORLD EXPORTS OF NICKEL METAL INCLUDING ALLOYS 25

8. WORLD IMPORTS OF NICKEL METAL INCLUDING ALLOYS 27

9. WESTERN STOCKS OF NICKEL 30

10. WORLD REFINED NICKEL CONSUMPTION 33

11. LONDON METAL EXCHANGE AVERAGE SETTLEMENT PRICES

FOR NICKEL 35

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INTRODUCTION

This draft review of development trends in the nickel industr - (1980-1988)

and prospects for the 1990s was prepared by the ECA/MULPOC/LUSAKA. It is a

desk study based on data and information derived from the Central Statistics

Office (CSO), the University of Zambia School of Mines, and the Zambia

Consolidated Copper Mines (ZCCM).

The draft review will be improved as up-to-date statistics concerning

the industry are made available. Moreover, comments on this draft review

will be sought from the African nickel industry, African governments and

other institutions, in order to make the final document as accurate as

possible. The final report will evenmally be disseminated to all institutions

with interest in the African nickel industry. The basic objective of the review

is to stimulate actions at various levels (in the nickel industry, governments,

researchers, etc.) which could enhance the contribution of the nickel industry

towards the economic advancement of the African region.

In the draft review, the countries of the world have been grouped in

geographical regions according to the area of responsibility of the United

Nations Regional Commissions: The Economic Commission for Africa (ECA);

the Economic Commission for Europe (ECE); the Economic Commission for Latin America and the Caribbean (ECLAC); the Economic and Social Commission for

Asia and the Pacific (ESCAP); and the Economic and Social Commission for

Western Asia (ESCWA),

The writer wishes to record his deeo appreciation to Messrs: Edwin M. Koloko, Director of Corporate Planning (ZCCM); Peter Freeman, Consulting Geologist (ZCCM);

Henry Mumba, Senior Lecturer (School of Mines); and Mrs. J.S. Mulenga, Chief

Librarian (CSO) for the kind assistance generously provided in the preparation

of this draft review.

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BRIEF SUMMARY OF THE REVIEW

The main end-use sectors for nickel are the production of steel; the

production of nickel-based and copper-based alloys; and in plating. It

is estimated that stainless steel production accounts for nearly sixty

percent of world nickel consumption. Thus prospects for world nickel

production and consumption are largely determined by stainless steel demand.

The products of the stainless steel industry in turn find their major uses in

such capital investment sectors as the construction (buildings, plant and

equipment) and automobile industries. ,

Generally the period 1980 to 1986 were not good years for nickel,

reflecting depressed activity in the stainless steel industry. World refined

nickel consumption declined successively from nearly 717000 metric tons in

1980 to about 649000 metric tons in 1982. During 1983 world nickel consumption

started to improve moderately reaching nearly 687000 metric tons. However, for

the period 1984 to 1986 the world annual consumption of nickel remained generally steady at around 778000 metric tons. Conditions began to improve in the steel

industry during 1987, resulting in an appreciable increase of nickel consumption

during the year to an estimated 847000 metric tons.

The world percentage share of refined nickel consumption in the ECA region

increased marginally from 0.9% in 1980 to 1.2% in 1987. The corresponding world shares of refined nickel consumption for the other regions were: the ECE

decreasing from 74.1% to 69.9%; the ECLAC decreasing from 2.4% to 2.1%; and the ESCAP increasing from 22.7% to 26.8%. Most probably, future prospects for

increased world nickel consumption depend on the increased infrastructure and

industrialization within the present developing countries using either steel and steel products produced in the ECE and ESCAP regions or steel and steel products produced in new facilities in ;he developing countries.

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As a reflection of the depressed demand for nickel during the period 1980 to 1987, the London Metal Exchange (LME) cash settlement prices for nickel during that period averaged below US$3000.00 per metric ton, except for the period 1983 to 1985 when they ranged from US$3088.86 to US$3836.12. However, during 1988 LME cash settlement prices for nickel averaged US$14317.78 per metric ton. The higher than normal prices for nickel during 1988 were created by a surge in stainless steel production during 1987/1988 which created more demand for nickel than could be supplied by producers or the already pertaining very

low commercial nickel stock levels.

Judged from mine production statistics, Canada and the Soviet Union (ECE) are the most nickel resources endowed countries in the world. Relatively less

significant occurances of nickel resources are restricted to few countries in

the ECA (Botswana, South Africa and Zimbabwe); ECE (Albania, Finland, Greece,

German Democratic Republic, Norway, the United States of America and Yugoslavia);

ECLAC (Brazil, Colombia, Cuba and the Dominican Republic); and ESCAP (Australia, Burma, China, Indonesia, New Caledonia, and the Philippines) regions.

World mine annual production of nickel ranged from nearly 758 000 metric

\n

tons ofmetal content 1980 to 800 000 metric tons in 1987. During the period A

1981 to 1983 world annual mine production levels were lower than they were

during 1980. The ECA region's percentage share of world mine production of nickel was steady at nearly 7.6% during the period 1980 to 1987. The ECE's

comparable percentage share was similarly steady at around 49.0% during

the same period. On the other hand, the ECLAC region's comparable percentage share of production increased from 8.9% in 1980 to 13.9% in 1987. With regard

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to the ESCAP region the comparable percentage share of world nickel mine

production decreased from 34,2% in 1980 t;o 28.7% in 1987. Judged from the experience of the 1980s, the countries which are likely to contribute

towards increased volume of nickel mine production during the 1990s may include Canada and the Soviet Union (ECE); Brazil, Colombia and the Dominican Republic (ECLAC); and China (ESCAP).

On the other hand, world nickel smelter/refining production increased

from nearly 739000 metric tons in 1980 to about 756000 metric tons in 1987.

Except for 1985 when production exceeded the 1980 level at nearly 749000 metric tons, production of refined nickel in the other years was below that attained

in 1980. The ECA share of world production of refined nickel increased from

4.5% in 1980 to 5.8% in 1987. The corresponding world shares of nickel

production for the other regions were: the ECE decreasing from 61.1% to 58.7%; the ECLAC increasing from 5.3% to 9.4%; and the ESCAP decreasing from

29.1% to 26.2%. It seems that during this 1990s, refined nickel production

levels will depend on such factors as the demand for nickel by the steel

industry and subsequent nickel prices.

WORLD NICKEL RESERVES AND RESOURCES

Statistics on the world distribution of nickel resources are not available

to the writer of this draft review of developments in the nickel industry.

This section of the study will thus be improved at a later date depending

on the availability of relevant data and information. Judged from mine

production statistics over the past eight years, however, it seems that

Canada and the Soviet Union (ECE) are tha most nickel resources endowed

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countries in the world. Relatively less significant occurances of nickel resources are restricted to few countries in the ECA (Botswana, South Africa and Zimbabwe); ECE (Albania, Finland, Greece, German Democratic Republic, Norway, the United States of America and Yugoslavia); ECLAC (Brazil, Colombia, Cuba and the Dominican Republic); and ESCAP (Australia, Burma, China, Indonesia, New Caledonia, and the Philippines) regions.

MINE PRODUCTION OF NICKEL

World mine production of nickel declinced from nearly 760,000 metric tons in 1980 to about 630000 metric tons in 1982. This decline was caused

largely by production cut backs in many countries caused by weak demand and unrealistically low nickel prices. Thereafter the world mine production of nickel increased steadily reaching nearly 800,000 metric tons in 1985, as a result of improved output particu:.arly in Canada and some other areas.

During 1986 mine production of nickel decreased again to about 780000 metric tons, but output during 1987 increased reaching an estimated 800000 metric

tons (Table 1).

The ECA region's percentage share of world mine production of nickel was Steady at nearly 7.6% during the period 1980 to 1987. However, the volume or production increased from an estimated 56700 metric tons in 1980 to 61200 metri-c tons in 1987. The African nickel producers were Botswana, South Africa

and Zimbabwe.

The ECE's percentage share of rforld mine production of nickel was similarly

steady at around 49.0% during the period 1980 to 1987. However, the volume of

production increased moderately from about 375000 metric tons in 1980 to

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398000 in 1987. Canada and the Soviet Union accounted for nearly 90.0% of

the ECE's output of mine nickel production. Albania, Finland and Greece were

among the other notable mine nickel producers.

The ECLAC region's world share of nickel mine production increased rapidly

from nearly 67000 metric tons (8.9%) in 1980 to 111200 metric tons (13.9%) in

1987. Production increases by volume were registered in three producer

countries - Brazil, Colombia and the Dominican Republic - while that of

Cuba slightly declined during the period under review.

, In the ESCAP region, the world share of nickel mine production decreased

from nearly 260000 metric tons (34.2%) in 1980 to 229000 metric tons (28.7%)

in 1987. During the period under review, the volume of production increased

in China and Indonesia; remained steady in Australia; and declined in New

Caledonia and the Philippines.

Judged from the experience of the 1980s, the countries which are

to contribute towards the increased volume of nickel mine production during

the 1990s may include Canada, and the Soviet Union (ECE); Brazil,

Colombia and the Dominican Republic (ECLAC); and China (ESCAP).

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- 7 —

Table 1: World Mine Production of Nickel (tonnes of metal concent)

1980 1981 1982

ECA REGION

Botswana 15442 18279 17763

Morocco 500 500 500

1983 1984 1985 1986 1987 1988

18214 19565 19567 18972 16528

South Africa

Zimbabwe

TOTAL

World %

ECE REGION

Canada

USA

Albania

Finland

Greece

German Dem.Rep.

Norway

Poland

USSR

Yugoslavia

TOTAL

World %

25700* 25000* 20500*

15075 13018 13301

20500* 22500* 29000* 31800 34300

10147 10251 9897 9732 10393

56717

7.5

56797

7.9

52064

8.3

48861

7.5

i

52316

6.8

58464

7.3

60504

7.8

61221

7.7

184802

13293

8500

6550

13900

2700

508

1100*

143000*

500*

160247

10976

8800

7557

10900

88581

2906

9000

4746

5000

2700 2500

489 405

1000* 700*

150000* 170000*

2000* 3500*

125022 173725 169971 163639 189086

13190 5558 1066

7200 9200 9600 10000 10500 5214 6928 9136 11800 10600

12900 15800 15900 10300 9200

2200 2000 2000 2000 2000*

359 326 425 467 600*

300* -

172000* 178000*173000* 166000* 173000*

1600* 2200* 2800* 3200* 3500*

374853

49.4

354669

49.3

287338

45.7

326795

49.8

401369

52.2

388390

48.6

368472

47.3

398486

49.8

(11)

1980

5838

-

8207

1981

6567

-

40260

1982

14451

2244

37603

1983

15561

17307

37^36

1984

23532

20799

31835

1985

20300

14608

32064

1986

21423

20980

33523

1987

21000*

2350Q*

34200*

1988

16350 19020 5958 19017 24805 25400 24100 3250Q 6744

67139

8.9

65847

9.2

60256

9.6

89521

13.7

100971

i

13.1

92372

11.6

100026

12.8

111200

13.9 Brazil

Colombia

Cuba

Dominican Rep.

Guatemala

TOTAL

World %

ESCAP REGION

Australia 74323 74355 87552 76625 76923 85757 76739 74554

Burma 14* 20* 20* 20* 20* 20* 20* 20*

China 11000* 11000* 13500* 13700* 18300* 25800* 29400* 30400*

Indonesia 40600 49400 48500 40200 47800 48200 67300 57200

New Caledonia 86592 78090 60101 46162 58326 72361 64518 58608

Philippines 47114 29247 19634 13900 13601 28158 12745 8500 TOTAL 259643 242112 229307 190607 214974 260296 250722 229282

World % 34.2 33.7 36.5 P3.1 27.9 32.6 32.2 28.7

WORLD TOTAL 758352 719425 628965 655784 769630 799522 779724 800189

Source: World Mineral Statistics by the British Geological Survey.

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INTERNATIONAL TRADE IN NICKEL ORES, CONCENTRATES, OXIDES, MATTES,

SINTERS, ETC.

World exports and imports of nickel ores, concentrates, oxides, mattes,

sinters, etc. during the period 1980 to 1987 are shown under tables 2 and

3 respectively. Exports by African region (Botswana and South Africa);

the ECLAC region (Cuba); and the ESCAP region (Australia, Indonesia,

New Caledonia and the Philippines) were practically wholly destined to the

ECE region and Japan (ESCAP). Exports by the ECE region represented

transactions within the ECE itself.With regard to imports, the ECA and

ECLAC REGIONS imported practically nothi-g while in the ESCAP region

Japan was about the sole importer with some initiation taking effect in

India, Taiwan and Australia during the second half of the 1980s. The

above patern oftrade in nickel ores, concentrates, oxides, mattes, sinters

etc. is not expected to witness much change during the 1990s.

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- 10 -

Table 2: World Exports of Nickel ores, concentrates, oxides, mattes, sinters etc. (tonnes)

South Africa

1980 1981 1982 1983 1984 1985 1986 1987 Remarks ECA REGION

Botswana 43025 46185 41587 52117 86587 53155 51290 560000* mattes &

sinters etp

54900* 79500* 48600* 36200* 46000* 42800* 29200* 29700* "

ECE REGION

Canada(a) 59636 28265 40164 51273 79492 81276 ⁷¹⁷¹² ⁷⁷²⁷⁵ ^Ores,cone;

mattes etc

United Kingdom

France

Germany, Fed.Rep.of

Netherlands

Finland

Norway

Sovien Union

Sweden

Switzerland

2969

819

437

4258

1657

13773

-

ISO

5103

238

147

2866

2690

11360

-

16

2304

402

271

3490

2051

10824

-

106

23

720

62

7990

3563

955

9952

800*

117

27

272

80

1862

5300*

-

8231

250*

-

12

453

30

1549

3900*

-

10843

500*

-

105

761

8

1825

4200*

-

11871

200*

-

44

1383

15

1282

2900*

-

8991

300*

-

122

ma 11 e s oxides

mattes

ti

it

ore

mattes

ii

etc.

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11 -

1980 1981 1982 1983 1984 1985 1986

ECLAC REGION

Cuba (a) 37776 39076 38005 37807 36658 33416 34912

1987 Remarks

oxide etc

:■ I

EXCAP REGION I

Australia (a) 53000* 51600* 54500* 62000* 60900* 61800* 71000* 66500 metal ores j

i concjetc. :

Indonesia 925818 886992 759469 560992 629132 676749 1017513 1042373 ore raette !

etc.

New Caledonia 2034062 1623277 1509037 10701791341845 1455708 1087402 1029629 "

Philippines 608825 557583 408712 346973 52705 616455 420809 483417 ores,cone

etc.

(a) Nickel content

Figures not available

* Estimates.

Source: World Mineral Statistics by the British Geological Survey (1980-1987).

(15)

- 12 -

Table 3: World Imports of nickel ores, concentrates, oxides, mattes sinters ,;

etc. (tonnes)

1980 1981 1982 1983 1984 1985 1986 1987 Remarks

ECA REGION

South Africa 0 150 560 445 577 904 628

Zimbabwe ''*

ma.ttes at©,

ECE REGION

Canada (a)

United Kingdom

France

Germany Fed.Rep.

Italy

Netherlands

Austria

Spain

Finland

Norway

Sweden

Switzerland

U.S.A.

26149

39345

464

15294

14507

5204

4822

1279

1779

22198

89855

4453

1340

74538

23760

552

19636

12676

4663

3708

734

2244

18672

84252

3113

1164

98271

22355

426

10999

14040

4300

833

2353

19432

62419

2603

1034

54830

29401

111

1637

12185

4976

14867*

622

2625

22089

63140

4059

895

58370

24736

2786

8932

12622

6367

7752*

1122

2376

16111

93459

2934

901

75913*

31592

1811

13804

12817

5401

10714*

1207

1849

23420

102443

2700

1261

60080

38331

3776

13680

11744

6763

8741*

907

1591

20238

101073

3513

1382

5230

23533

4415

11758

13384

7183

6045*

405

1503

17030

92110

3515

1157

5559

ores,cone;

etc.

mattes etc.

M

Tl

II

H

n

it

M

11

It

II

(16)

- 13 -

1980 1981 1982 1983 1984 1985 1986 1987

ECLAC REGION

84 matte etc.

ESCAP REGION

Australia 1928 51 0 121 1869

India - - - ... ... 3276 ... ... "

Japan 4003869 3500848 3038567 2335399 2885323 3028661 2944135 2981467 ore etc.

Taiwan 429 1949 2938 11514 11256 matte etc.

(a) nickel content

Figures not available

* Estimates.

Source: World Mineral Statistics by the British Geological Survey (1980-1987)

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INTERNATIONAL TRADE IN NICKEL SCRAP

International trade in nickel scrap was by all intents and purposes non

existent in the ECA and ECLAC regions during the period 1980 to 1987. This

trade was largely confined to the ECE region and to a relatively smaller

extent in the ESCAP region. Thus this trade which involved tonnages ranging

from about 35000 to 50000 metric tons annually was confined to steel and

manufacturing countries.

It is understood that there are three types of nickel scrap: "industrial",

"reclaimed" and "revert". Industrial scrap is generated from the manufacture

of semi-finished through to finished steel-containing products. Reclaimed

scrap results from the maturing of stainless steel use, and comes from the

scraping of buildings, plant and equipment built over the past 30 years.

Revert scrap simply flows around steel works. Of the three, it is revert

and industrial scrap which are most likely to influence the behaviour of

the nickel market. It is thought that the nickel export and import statistics

indicated under table 4 and 5 respectively constitute both revert and industrial

scrap.

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.5 -

Table 7: World Exports of Nickel Scrap (tonnes)

1980 1981 1982 1983 1984 1985 1986 1987

ECA REGION

South Africa 200* 100* 200* 100* 400* 400* 200* 400*'

Total

ECE REGION

Canada

U.S.A.

United Kingdom

Benelux

Denmark

France

Germany, F.R. of

Greece

Irish Rep.

Italy

Netherlands

Australia

Finland

Norway

Spain

Sweden

Switzerland

Yugoslavia

200*

2664

18806

4404

1440

95

2179

5317

90

-

271

2168

302

-

391

168

511

233

288

39327

100*

2927

9834

4195

1432

32

2461

7780

311

-

318

1564

451

_

583

78

525

247

148

32886

200*

3283

10100

5136

984

47

2064

7700

22

-

290

1808

255

392

197

24

573

241

170

33296

100*

2988

12056

5637

708

43

2070

7637

590

51

165

2206

457

4628

107

36

1620 318

93

41410

400*

' 9693

11934

5842

843

58

3602

9404 21

149

169

3015

774

2269

49

328

613

422

154

49339

400*

4948

14093

5408

1139

15

3637

10032

18

151

119

3068

295

1777

143

164

533

256

398

46194

200* •

6253

9538

4629

739

30

3109

5668

-

161

163

4684 214

59

108

96

655

295

70

36479

400*

7663 10489

5030

991

87

2865

6492

• •»

208

281

3433

104

55

91

64

740

369 81

39043

(19)

- 16 -

(Table 4 cont'd)

ECLAC REGION

1980 1981 1982 1983 1984 1985 1986 1987

ESCAP REGION

Hong Kong

Singapore

Taiwan

TOTAL

WORLD TOTAL

209

561

572

1342

40869

435

503

947

1885

34871

487

533

1198

2220

35716

378

413

1423

2214

43724

293

160

1825

2278

52017

118

1072

1889

3079

49673

387

280

1506

2173

38852

956

142

2180

3278

42721

Source: World Mineral Statistics by the British Geological Survey,

(1980-1987).

(20)

17

Table 5: World Imports of Nickel Scrap (tonnes)

1980 1981 1982 1983 1984 1985 1986 1987

ECA REGION

ECE REGION

U.S.A.

United Kingdom

Benelux

France

Germany F.R. of,

Italy

Netherlands

Austria

Finland

Norway

Sweden

Switzerland

TOTAL

ECLAC REGION

3240

2174

519

763

7552

685

1021

1597

1944

7

2609

164

22275

4741

2390

983

5469

335

1377

567

1449

21

2082

240

20637

3901

3359

499

466

6419

320

1527

357

1959

31

2930

242

22010

5507

2298

327

529

4902

140

1320

222

1987

8

3365

94

20699

5623

2810

;601 917

8389

81

3737

608

2489

73

4575

70

29973

5036

4137

527

942

7561

271

2943

572

2681

3

5510

86

30269

6164

3197

304

669

6062

87

2776

155

3839

12

6709

29

30003

6865

4503

627

579

6987

220

2773

949

3216

11

6048

29

32807

(21)

- 18 -

(Table 5 Cont'd)

1980

TOTAL 4077

1981 1982 1983 1984 1985 1986 1987

ESCAP REGION

Australia

India

Japan

Korea, Rep. of

Singapore

Taiwan

-

2261

1806

10

-

2992

2252

4

-

5248

WORLD TOTAL 26352 25885

2938

318

14

668

167

145

133

44

3242

224

182

136

129

1101

2622

327

170

396

211

2219

284

182

1223

353

3089

554

284

383

4745

35014

Source: World Mineral Statistics by the British Geological

Survey (1980-1987).

(22)

- 19 -

WORLD NICKEL SMELTER/REFINING PRODUCTION

World nickel smelter/refining production decreased successively from nearly 739000 metric tons in 1980 to 614000 metric tons in 1982. Thereafter production increased gradually from nearly 668000 metric tons in 1983 to 749 000 metric tons in 1985. During 1986 production decreased to about 727000 metric tons but increased to an estimated 756000 metric tons in 1987 (Table 6).

Within the ECA region, nickel smelter/refining production generally

increased from a world share of nearly 33200 metric tons (4.5%) in 1980 to

43700 metric tons (5.8%) in 1987. The only African producers were South ■ Africa and Zimbabwe.

In the ECE region on the world share of nickel smelter/refining production

generally remained steady at about 61.1% during the period 1980 to 1984 and subresequently slightly declined to around 58.3% during the period 1985 to 1987.

The dominant producers were Canada and the Soviet Union although several other countries in this region produced relatively smaller quantities of the metal.

With regard to the ECLAC region, the world share of nickel smelter/refining production increased somewhat steadity from 39100 metric tons (5.3%) in 1980 to 70900 metric tons (9.4%) in 1987. While the contribution of Cuba gradually

decreased during the period under review, that of Brazil, Colombia and the Dominican Republic were on the increase.

Within the ESCAP region, the world share of nickel smelter/ refining

production generally decreased from about 215000 metric tons (29.1%) in 1980

to about 198000 metric tons (26.2%) in 1987. The major producer in this region

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- 20 -

was Japan, followed by Australia, New Caledonia and China. Production in the

Philippines declined from around 22700 metric tons in 1980 to nothing in 1987.

It is reported that during the period 1985 to 1987 there were a number of

closures of high cost smelter/refining capacities. The most significant plants to

go out of business were Nonoc in the Philipplines (which accounted for 30,000

metric tons per year of annual capacity) and Amax's port Nickel refinery

in the United States (which accounted for 36000 metric tons per year of annual

capacity). In view of weak demand for nickel in most of the period under review

with subsequent weak nickel prices, many other nickel producers are reported to

have managed to stay in business through: government intervention; diversified

mining portfolio (offsetting nickel losses against profits elsewhere); or through

cost cutting. It seems that during the 1990s refined nickel production levels

will depend on such factors as the demand for nickel by the steel industry and

subsequent nickel prices.

■,r: ,:■.:.■[! u r<■

(24)

- 21 -

Table 6: World Nickel smelter/refinery production (tonnes)

ECA REGION

1980

South Africa 18100

Zimbabwe

TOTAL

World %

ECE REGION

Canada

USA

United Kingdom

France

Greece

Albania

Czechos lovakia

Finland

German Dem. Rep.

Norway

Poland

USSR

Yugoslavia

TOTAL

World %

15100

33200

4.5

142155

40120

19300

9792

13880

4500*

2200*

12646

3000*

37123

1800*

165000*

-

451516

61.1

1981

17200

12400

29600

4.2

106406

44275

25400

10051

10860

4500*

1600*

13051

2800*

36954

1500*

170000*

-

427397

61.1

1982

17300

14600

31900

5.2

61544

40783

6902

7360

4778

4500*

1500*

12304.

3000*

25833

700*

190000*

1500

360704

58.7

1983

19200

13000

32200

4.8

93047

30300

23200

4878

12858

4500

3000*

14514

3000*

28619

300*

192000*

1000

411216

61.6

1984

20500

10400

30900

, 4.2

111591

40763

2230C

5217

15829

4000

4500*

15282

3000*

35548

-

193000*

1800

452830

62.1

1985

24000

11500

35500

4.7

108041

33005

17800

7019

15900

4000

4000*

15656

3000*

37513

-

190000*

2800

438734

58.6

1986

27000

16400

43400

6.0

111279

1498

30900

8241

10300

4000

4000*

17791

3200*

38202

-

188000*

3200

420611

57.8

1987

27000

16700

43700

5,8

131500

-

29500

6680

9200

4500

4000*

15392

3500*

44565

-

191000*

3500

443337

58.7

(25)

- 22 -

(Table 6 continued)

1980 ECLAC REGION

Brazil 2504

Colombia -

Cuba 20020

Dominican Rep. 16552

TOTAL

WORLD %

1981 1982 1983 1984 1985 1986

ESCAP REGION

Australia

China

Indonesia

Japan

New Caledonia

Philippines

TOTAL

World X

WORLD TOTAL

Source: World Mineral Statistics by the British Geological Survey.

(1980-1987).

35309

11000*

4421

109300

32580

22731

42505 45931 41800 12000* 12500* 13000*

4703 5000 4900 93600 87300 82300 27989 28007 21717 19353 10200 6097

1987

2334

-

20850

18679

4813

1463

21001

5484

10740

13055

9342

21202

12716

16575

8452

24219

13166

11373

8829

25802

13465

18018

8382

21989

13862

19300

8600*

29100

39076

5.3

41863

6.0

32761

5.3

54339

8.1

61962

8^5

59170

7.9

61854

8.5

70862

9.4

38660

17500*

4800

89361

29158

3528

40807

24600*

4800

92594

36103

16993

42097

28000*

4500

92750

33001

1153

44529 29000*

3100

61605 29531

215341

29.1

739133

200150

28.6

699010

188938

30.8

614303

169814

25.4

667569

183007

25.1

728699

215897

28.8

749301

201501

27.7

727366

26.2

755664

(26)

- 23 -

INTERNATIONAL TRADE IN REFINED NICKEL INCLUDING ALLOYS

Statistics on world international trade in refined nickel and nickel alloys

are generally incomplete as will be observed from the available export and import

figures (Tables 7 and 8). However, it could be deduced from the available

statistics that world international trade in refined nickel and nickel alloys

ranged from about 250 000 to 290 000 metric tons annually during the period

1980 to 1987.

In the ECA region, exports of refined nickel (by South Africa and Zimbabwe)

to the ECE and ESCAP ranged from 17000 to 32000 annually from 1980 to 1987. In this region there were no imports of refined nickel and nickel alloys of any significance

during the period under review.

Within the ECE region, exports of refined nickel and nickel alloys ranged

from about 197000 to 246000 metric tons per year during the period 1980 to 1987.

On the other hand imports of refined nickel and nickel alloys ranged from around

2088000 to 265000,annually during the period under review. International trade in refined nickel and nickel alloys in this region represented largely transactions within the EEC countries.

With regard to the ECLAC region the e were practically no exports of refined nickel and nickel alloys from the region during the period under review. ' On the other hand, declining volumes of imports oE these commodities were effected to this region ranging from about 6800 to 1500 metric tons annually during the period 1980 to 1987, reflecting a declining performance of the steel industries of the countries concerned during the 1980s.

(27)

- 24 -

As far as the ESCAP region was concerned, exports of nickel and nickel alloys declined gradually ranging from about 24000 to 9000 metric tons during the

period 1980 to 1987. On the other hand imports to this region were on a moderate increase, ranging from about 33700 to 45000 annually during the period

under review.

(28)

- 25 -

Table 7: World Exports of Nickel metal including alloys (tonnes)

1980 1981 1982 1983 1984 1985 1986 1987

ECA REGION

South Africa 23400* 17900* 16800* 15500* 16400* 16100* 17900* 14800*

7,-^^™ . . . ... 16237 11303 10896 14326 15832

TOTAL WORLD %

ECE REGION

Canada

United Kingdom

Benelux

France

Germany, F.R.

Irish Rep.

Italy

Netherlands

Finland

Norway

Soviet Union

U.S.A.

Yugoslavia

TOTAL WORLD %

23400

...

88493

10986

313

6757

6436

169

4446

11104

31250

30800*

13854

206514

17900

.. .

79987

20380

118

5264

4501

131

3087

11135

36931

31700*

15657

210288

16800

62463

11425

689

4359

9461

209

2495

9757

29270

34500*

31283

196628

317J7

12.3

67386

13735

442

5416

14358

108

713

2013

11322

30014

35c00*

20309

46

201844

78.2

27703

10.6

80508

12376

253

5582

10346

59

141

426

13247

37812

37500*

23815

466

223153

85.4

26996

11.0

81773

10585

218

6220

6631

36

124

443

13852

35669

29100*

16415

347

201509

82.0

32226

12.7

86057

17450

313

6940

6390

35

113

500

15086

37917

37800*

1961

-

210614

83.2

30632

10.7

96165

18565

371

6839

9427

7

378

650

13309

44125

54600*

1825

-

246339

86.1

(29)

- 26 -

(Table 7 cont'd)

1980 1981 1982 1983 1984 1985 1986 1987

ECLAC REGION

KSCAP REGION

Hong Kong

Singapore

Japan

Philippines

Taiwan

TOTAL

WORLD %

WORLD TOTAL

2196

1392

1330

18823

54

20207

...

A

_.

2895

1201

1262

15469

36

16767

Figures

2793

2774

298

5869

38

6205

"

kill

9409

285

10362

111

24444

9.5

258025

not available Estimated

Nil

—

3020

4685

348

2344

3

10400

4.0

261256

3242

2017

313

11284

392

17248

7.0

245753

4865 2399

181

2566

356

10367

4.1

253207

—

6228

1483

228

-

1140

9079

3.2

286050

Source: World Mineral Statistics by the British Geological Survey, (1980-1987).

(30)

- 27 -

Table 8: World Imports of Nickel -metal including alloys (tonnes)

1980 1981 1982 1983 1984 1985 1986

ECA REGION

South Africa

Total

WORLD %

£CE REGION

1987

542

0.2

522

0.2

103

...

40

57

41

0.0

Canada

United Kinj;

Benelux

Denmark

France

Germany, F.

Greece

Irish Rep.

Italy

Netherlands

Portugal

Spain Austria

5224

;dom 18240

3061

180

22554

R.' 39329

182

254

18754

5567

139

6104

2378

Czechoslovakia 7 919

Finland

Norway

Sweden , USA

Yugoslavia TOTAL WORLD %

4299

79

10810 107497 1960 254530 86.1

2927

16957

2449

115

19911

39929

41

188

12.153

3735

246

3668

2586

8340

2460

188

8038 109804

2150 235892 83.2

3403

15252

4118

161

19498

40576

153

187

17910

3390

297

5036

2129

6741

2869

85

10861 74328 1074 208067

3355

10890

4340

244

20552

44830

100

142

14257

3116

275

4982

2388

806C

4973

281

9596 84709

1394 218984

. . .

4100

15359

3050

360

22698

48284

73

220

20284

1634

223

4776

3105

6483

4661

146

12859 93456 2659 244430

.. .

3338

16164

2596

144

19772

42368

1J3

305

17917

1771

286

3780

2664

6558

5084

202

12183 88704 2837 226808 82.7

3451

16084

3787

216

18553

46071

120

585

18387

3115

347

4863

3030

5473

2735

153

10348 91717 2395 231430

3348

18158

6646

249

27584

57342

398

16465

1917

328

4270

2814

7460

2313

64

10805 103314

1627 265102

(31)

(Table 8 cont'd)

1980 1981 1982 1983 1984 1985 1986 1987

ECLAC REGION

Argentina

Brazil

Colombia

Venezuela

TOTAL

WORLD %

ESCAP REGION

Australia

Hong Kong

India

Japan

Korea, Dem.

Rep. of

Korea Rep.of

Newze?1and

Malaysia

Singapore Taiwan Thailand TOTAL

WORLD % WORLD TOTAL

636

5850

121

185

6792

2.3

1635

3487

3252

15617

2853

107

3322

1195

2230

33699

11.4 295563

395

4950

245

207

5797

2.0

1484

4534

7728

17883

3811

116

2010

1415

2479

41460

14.6 283671

443

1747

121

185

2496

1943

3312

19907

2451

142

499

1414

2822

. . .

• . •

762

174

231

109

1276

388

5008

27059

200*

2002

10

296

11385

4060

S22

. . .

735

341

309

171

1556

1265

4494

31549

500*

2306

105

398

917

4497

433

...

. . .

311

1135

144

201

1791

0.7

817

3811

4765

24898

700*

3472

131

104

2638

3863

387

45586

16.6 274226

538

1915

280

493

3226

1123

7056

24349

600*

5839

65

133

3726

6535

517

•. .

1700

327

1262

6220

42613

1900*

4961

64

111

1493

6364

775

. . ■

... 'Figures not available

Source: World Mineral Statistics by the British Geological Survey (1980-1987).

(32)

- 29 -

WESTERN WORLD STOCKS OF NICKEL

Western world commercial stocks of nickel held by producers, metal exchange^

merchants and consumers were roughly constant at around 200000 metric tons

annually between 1980 and 1982. Commencing 1983, these stocks declined gradually

until they reached a low of nearly 89000 metric tons in 1987 (table 9).Strategic

stocks of nickel were on the other hand kept only by the United States of America,

These stocks were at the annual level of a out 29000 tons between the period 1980

to 1984, after which they were increased to just over 33000 metric tons per year

from 1985 to 1987. It is most likely that during the 1990s western commercial stocks of nickel will be gradually restored to more normal working levels through

increased primary metal production in various parts of the world.

(33)

- 30 -

Table 9: Western World stocks of nickel. (thousand metric tons)

1980 1981 1982 1983 1984 1985 1986 1987

METAL EXCHANGE STOCKS

London Metal Exchange 4.4 2.2 6.7 27.6 7.3 6.4 7.5 4.0

Country Stocks 193.8 216.0 194.6 154.9 140.0 122.4 116.1 84.5

(i) TOTAL COMMERCIAL STOCKS

(ii) STRATEGIC STOCKPILES

198

29 .2

.7

218

28 .2

.8

201

28 .3

.8

182

28 .5

.8

147

' 28

.3

.8

128

33 .8

.4

123

33 .6

.4

88.5

33.4

Source: World Bureau of Metal Statistics,

(34)

— 31 —

REFINED NICKEL CONSUMPTION

World refined nickel consumption declined successively from nearly

717000 metric tons in 1980 to about 649000 metric tons in 1982 because of

depressed industrial production in major nickel consuming sectors especially

in the ECE and ESCAP regions. During 1983 to 1984 world refined nickel

consumption improved to about 687000 and 782000 metric tons respectively,

while in 1985 world refined nickel consumption declined to nearly 775000 metric

tons. In 1986 world refined nickel consumption was nearly the same as that for

1985 at about 778000 metric tons. It rfas only in 1987 that there was an

appreciable increase of world refined nickel consumption at an estimated

847000 metric tons. Thus between 1980 and 1986 world refined nickel consumption

was generally depressed.

Nickel's main end-use sectors are the iron and steel industry; the production

of nickel-based and copper-based alloys; and in plating. It is estimated that

stainless steel production accounts for nearly 60% of world nickel consumption.

Thus prospects for world nickel production and consumption are largely determined

by the health of the stainless steel industry. The products of the stainless

steel industry in turn find their major uses in such capital investment sectors

as the construction (buildings, plant and equipment) and automobile industries.

The world share of refined nickel consumption in the ECA region increased

marginally from 6100 metric tons (0.9%) in 1980 to 10000 metric tons (1.2%) in

1987. In the ECE region the volume of refined nickel consumption increased from

531200 to 591700 metric tons from 198r to 1987, though the percentage share of

world consumption decreased from 74.1% to 69.9% in the respective years. Similarly,

in the ECLAC region the volume of refined nickel consumption increased from 16900

to 18000 metric tons from 1980 to 1987, but the percentage share of world

consumption decreased slightly from 2.4% to 2.1% in the respective years. Within

the ESCAP region the world share of refined nickel consumption increased from

162500 metric tons (22.7%) in 1980 to 227300 metric tons (26.8%) in 1987.

(35)

- 32 -

Refined nickel consumption in the iiCA region is believed to be confined

largely to South Africa and to a relatively smaller extent Zimbabwe.

In the ECE region the dominant refined nickel consumers are the United States and the Soviet Union. Other important consumers are the Federal Republic

of Germany, France, Italy, United Kingdom, Sweden, Czechoslovakia, the German Democratic Republic, Canada, Finland, Spain, Poland and Romania. These are the

important manufacturers of capital goods in the world, such as industrial plant, machinery and other equipment.

Within the ECLAC region the dominant refined nickel consumer is Brazil.

Argentinal and Mexico consume relatively smaller quantities of nickel.

In the ESCAP region, Japan is the most significant consumer of refined

nickel. Other important countries are china and India whose consumption of

nickel is increasing steadily.

The 1985 "Mining Annual Review" reported that North American nickel producers, supported by a number of other producers, initiated Che establishment of Che Nickel Development Institute (NiDi) to promote new markets and uses for nickel as well as to defend and expand the existing applications lor the metal. NiDi is accordingly reported to have established a very useiul market development function between nickel producer and

user industries since 1985. Similarly, during 1984 discussions were re'>ori;ed to have, taken pl.ice amoag some ^ovt'irnment representatives on

the possibility of establishing an intergovernmental institute or study

group for data collection, analysis ^nd dis.e:njnutLnn in the nickel industry.

The vr-'cer of this report is, however, unaware oi progress so far made /

(36)

- 33 -

Table 10 World refined nickel consumption. (thousand metric tons)

1980 1981 1982 1983 1984 1985 1986 1987

ECA REGION 6.1 5.0 5.0 7.0 9.0 11.0 11.0 10.0

ECE REGION 531.2 499.4 485.0 517.2 561.9 557.8 549.4 591.7

ECLAC REGION 16.9 12.9 12.8 10.0 16.4 17.4 17.6 18.0

ESCAP REGION 162.5 144.7 145.7 153.2 194.4 189.0 199.8 227.3

TOTAL 716.7 662.0 648.5 687.4 781.7 775.2 777.8 847.0

Source: World Bureau of Metal Statistics.

(37)

- 34 -

NICKEL PRICES

The London Metal Exchange (LME) cash settlement prices for nickel during

the period 1980 to 1987 were below US$3000 per metric ton with the exception

of the period 1983 to 1985 when they were above US$3000 per metric ton. 1986

was the worst year with an average price of US$2647.05 per metric ton. During

1987 prices improved moderately to an average of US$2959.64 before reaching a relative record average price of US$14317.78 per metric ton in 1988. The surge in stainless steel production during 1987-1988 created more nickel

demand than could be supplied by producers or the already pertaining very low commercial nickel stock levels.

(38)

-35-

Table 11: London Metal Exchange (LME) average settlement prices for nickel (US$ per metric ton)

MEaverageprice %annual eincrease

198019811982198319841985198619871988

2809.57 2951.19 2750.91 3088.86 3569.16 3836.12 2647.05 2959.64 14317.78 2809.57 2950.05 3097.55 3252.43 3415.05 3585.80 3765.09 3953.35 4151.01

Source:WorldBureauofMetalStatistics.