Canico Resource Corp (CNI)

[Frank Pembleton]

Nickel hits two-month highs

By Martin Hayes

Nickel prices rose to their highest levels since mid-March on Friday, as a fundamentally tight market received an added boost from news that the world's largest producer, Russia's Norilsk Nickel will stop shipping metal to the West during the summer.

On the London Metal Exchange (LME), nickel prices rose $80 a tonne to $8,420, driven by speculative buying.

Norilsk said on Friday it would shortly halt all shipments from its Arctic port of Dudinka, ahead of annual flooding caused by meltwater from the Yenisey river, where the port is located.

"Nickel didn't really motor like copper and aluminium earlier in the week. Overall the fundamentals are pretty good, and some of the people I've been speaking to have been keen get in on the long side," a trader said.

On the LME, nickel is in a backwardation, with nearby prices higher than forward, indicating a scarcity of immediate supplies.

This is also reflecting concern over ongoing labour talks at Canada's nickel giant Inco Ltd and the union at its key Sudbury mining and milling complex in Ontario.

These are expected to centre on crucial wage and pension issues from next week.

http://www.forbes.com/newswire/2003/05/16/rtr973766.html