Japan's Sumitomo Metal says global nickel deficit to widen this year
TOKYO, June 14 (Reuters) – Sumitomo Metal Mining, Japan's biggest nickel smelter, expects a global nickel market deficit to widen to 88,000 tonnes this year, from 72,000 tonnes last year, amid solid demand for stainless steel and batteries, an official said on Thursday.
Global demand for nickel is seen increasing by 7.3 percent in 2018 from last year to 2.298 million tonnes, while supply rises 6.8 percent to 2.210 million tonnes, the company said. "We expect higher demand for stainless steel and automotive batteries," Masanori Ohyama, general manager of Sumitomo Metal Mining's nickel sales and raw materials department, told reporters.
Electric vehicle batteries are a new source of demand for nickel. Sumitomo Metal Mining, which also makes materials for electronic parts, supplies cathode materials for Panasonic Corp's lithium ion batteries that are used in Tesla Inc's electric vehicles.
"An increase in nickel supply will come mainly from nickel pig iron output in China and Indonesia," Ohyama said, predicting tightness in higher-quality nickel to continue this year.
Japan's demand for nickel is projected to rise 7.0 percent to 184,200 tonnes, while supply is forecast to climb 4.1 percent to 194,900 tonnes, resulting in a surplus of 10,700 tonnes, Sumitomo Metal Mining said.
The company's forecast for the global nickel market is detailed below (in 1,000 tonnes):
(Reporting by Yuka Obayashi; Editing by Tom Hogue)