[ferro-alloys.com]Global production of stainless steel, the main outlet for nickel, remains strong over the first three months of 2018, up 6% compared to the same period of 2017, reaching 12.2 million tonnes. However, global production of stainless steel is down 3% compared to the last quarter of 2017, when it achieved record levels of activity.

Global production of primary nickel posted a sustained increase in the first quarter of the year at around 530 kt (+8% compared to the same period in 2017), notably driven by the ongoing ramp up at new plants in Indonesia.

At the end of March 2018, nickel metal inventories on the LME and SHFE (Shanghai

Futures Exchange) amounted altogether to 368 kt and continue to decline (-11%

compared to the end of 2017 and -19% compared to the end of March 2017).

As for all base metals, nickel prices were sustained in the first quarter of 2018 by the weakening of the US dollar, a renewed interest in commodities, as well as a favourable economic situation. The average price of nickel on the LME for the quarter amounted to 13,276 USD/t (6.02 USD/lb), a marked increase over the same period in 2017 (+29%, compared with 10,271 USD/t or 4.66 USD/lb on average) and when compared to the fourth quarter of 2017 (+15%, compared to 11,584 USD/t or 5.25 USD/lb on average).Additionally, market players continue to anticipate a future demand for pure nickel, which is used in the manufacture of batteries for electric vehicles.

In the first quarter of 2018, nickel production is slightly down (-2% to 14.7 kt) compared to the corresponding period of 2017. The ramp-up of the Sandouville nickel refinery continues, with a gradually increasing operating rate. The SLN teams in New Caledonia remain fully engaged in the cash-cost reduction programme.

Demand for SLN's ferronickel, which is still sought after by stainless steel producers,remains very strong with high premiums. 

• [Editor:王可]