April 30, 2010 – Nickel Smashes Through to Three Year High

Featured Trades: (NICKEL), (JJN)


3) Nickel Smashes Through to Three Year High. The bull market in industrial commodities has spilled over from copper, palladium, iron ore to nickel, which hit $27,500/ tonne in trading on the London Metals Exchange yesterday, up 42% YTD. As a result of the price surge, a nickel is now worth 6.2 cents of the base metal. The soaring demand for stainless steel is the main cause, with up to 60% of its cost now accounted for by the nickel content. Other factors include the annual closure of the Siberian port used by Norilsk, the world's largest nickel producer, and a strike at Vale's Canadian mines. If the world economy manages to dodge a double dip recession as the multiple forms of stimulus are pulled away, the old all time high for nickel of $50,000/tonne is a chip shot. On any decent pullback, take a look at the nickel ETN (JJN).

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