NICKEL extended gains to a 11-month high on concern the Philippines’s crackdown on mines is disrupting supplies from the world’s top supplier of nickel ore. A gauge of mining stocks climbed for the first time in a week.
The new government in the Philippines has pledged to shut mines that fall short of environmental and welfare standards. Environment Secretary Regina Paz L. Lopez said on Wednesday that the state plans to suspend shipments from an idled mine owned by the nation’s top refiner, Nickel Asia Corp., while the checkup is conducted.
Inventories of the metal in warehouses tracked by the London Metal Exchange (LME) fell 0.4 percent on Thursday to the lowest since October 2014. Prices also gained as China, the biggest user, said refined nickel imports more than doubled to a record in the first half. Nickel is up 22 percent this year, rebounding from a 42-percent slump in 2015, which was the worst performance among LME metals.
“Off-exchange nickel inventories are being eaten into by Philippine production curtailments, as this metal continues in its unfamiliar leadership role to the upside,” Michael Turek, the head of base metals at BGC Partners Inc. in New York, said in an e-mail.
Nickel for delivery in three months rose 1.7 percent to settle at $10,760 a metric ton at 5:51 p.m. on the LME, after reaching $10,900, the highest since August 11. Zinc touched a 14-month high, and copper, tin and lead also gained. Aluminum fell.
As disruptions to nickel supply start stacking up, a major Chinese steelmaker said it bought its first ore under a contract from New Caledonia, as users seek to tap alternative sources. Tsingshan Holding Group Co. sees nickel ore from New Caledonia as a “ good supplement” to supply from the Philippines, according to Kevin He, vice president of the steel company.
The FTSE 350 Mining Index rose 1.8 percent, rebounding from a two-week low. Vedanta Re-
sources Plc. and Glencore Plc. were among the best performers. Bloomberg News