Quarterly Report – April/May 2019

Nickel has continued its rollercoaster ride after a deflating final quarter to 2018 in which it fell around 15%. There was a gain of 24% from US$ 10,435 per tonne at the start of 2019 to around US$ 13,000 by the end of March for a quarterly cash average of US$ 12,380.  Renewed hopes of a constructive US/China trade deal and signs that Chinese government stimulus measures may have improved the outlook for the world’s second-largest economy restored positive sentiment to the market at the end of the first quarter.

Cobalt suffered a gruelling period of price decline in 2018 and the trend continued into the opening quarter of 2019 with a drop of around 26% over the first three months of this year from US$ 40,500 per tonne to US$ 29,900, which is equivalent to a cash average for the quarter of US$ 32,800.  

Although cobalt demand is expected to surge over the next few years, there is caution among investors and end users regarding stockpiling or long-term contracts owing to a number of factors. China’s announcement that it would cut incentives on the energy vehicle subsidy policy by an average of 50% affected pricing in the first quarter. The market was further unnerved by output disruptions in the Democratic Republic of the Congo and Zambia.

For most superalloys, the first quarter of 2019 saw generally good demand. With aerospace order books busy and improved oil & gas prospects, especially in the global liquid gas sector, demand is expected to continue through the second quarter with a cautious eye being kept on US/China trade talks.

Meanwhile, steelworks showing good demand for high-nickel alloys at the beginning of this year are now slowing down owing to high stocks and fewer orders. Uncertainty surrounding Brexit, trade wars and national populism within the EU is influencing the market. As long as order books remain well-filled, no abrupt decrease is anticipated.



Uwe Dierkes - Uwe Dierkes (Superalloys)

Uwe Dierkes

Siegfried Jacob Metallwerke GmbH & Co KG (DEU)


Country
Superalloys
Issue
Quarterly Report – April/May 2019
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