Nickel prices jumped on Tuesday after the Philippines, a major producer, ordered a moratorium on nickel mining on an island.
Philippine President Rodrigo duterte banned mining on tumbagan island in rangan province of tawi tawi province for fear of environmental impact.
Although the order did not cover the country's nickel mining center in the karaga region, potential supply disruptions pushed up prices.
The benchmark nickel price on the London Metal Exchange rose 3.3% to $17650 per ton, the biggest increase among base metals.
"It seems to be a small part of the nickel mines in the Philippines and it's worth noting, but I don't think it has a big impact on the actual supply," said Danielle Britzman, an analyst at Commerzbank. "
The Philippines is the largest supplier of nickel to China.
"The impact is small, but it depends on whether it extends beyond the initial region. If so, then the impact is significant, "said one trader.
Meanwhile, the French Mining Group Ehrman has warned that it risks liquidation within weeks if the protests continue to disrupt the operations of its nickel subsidiary in New Caledonia.
Inventory: the total nickel inventory in the LME registered warehouse increased by 372 tons, reaching the highest level since August 2018, reaching 249198 tons, an increase of about 60% last year.
Cancelled warrants - materials designated for delivery - account for 25%.
Spread: the discount of LME spot nickel on cmni0-3, a three-month contract, is about $55 per ton, lower than the six-month high of $67.5 hit in December. This suggests that concerns about oversupply in the LME system have eased.
Other prices: three month copper rose 1.4% to $7977 per ton on the London Metal Exchange, aluminum rose 0.6% to $2021.50, zinc rose 0.5% to $2781, lead rose 2.9% to $2023, and tin rose 0.9% to $20890.
- [Editor:Catherine Ren]