Inflation Reduction Act Implications Hit Home

Recording date: 19th October 2022
We discuss Korean battery manufacturers and what they want and what they are telling about the near term demand. Nickel prices dipped just below $22,000 nudged by 1,000 tonne uptick in LME inventories. The time for my expected sell-off is running out as more data showing the expected uptick in demand from EV sector and even strength in stainless steel coming out of the October holiday.
Chinese stainless price good indicator of market direction and have seen first bounce up - will see next week whether stainless inventories had continued to fall, but is good sign that demand picking up and market balance improving. Also NPI prices tick up and discount (while still large) also tighten up a little bit
Demand for nickel from the stainless sector is up 15% from the lows this summer and demand from battery sector up 70% from the lows last spring - China battery nickel demand running at nearly 500ktpa run rate in October up 50% YoY (please remember that global demand in 2021 was X290? kt)
Is interesting that NCM cathode production up 82% and battery output up over 100% (destocking) - when combine high growth rate and coming off destocking can see very sharp demand increases (this is what I was expecting to come through at year-end and looks like is coming through).
Lots of nickel needed to make batteries !!
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