(Kitco News) – According to the Australian Government’s Department of Industry, Science, Energy and Resources (DISER), global nickel production in 2020 suffered due to multiple mine closures and disrupted production due to the pandemic’s lockdown effect, and the total mined nickel of 2.4 million tonnes was down 12% compared to 2019.
DISER said that through 2021, nickel production is expected to recover to 2019 levels of around 2.6 million tonnes. Indonesia’s ore export ban and potential halts to New Caledonia’s production present downside risk for the year. The Philippines has been filling some of the gap and the rising price recovery in the first few months of 2021 has indicated an increased consumption activity.
Going forward, mine production is expected to grow as new refinery capacity in Indonesia creates a market for domestic mined output. Mine production is projected to grow an average 5% a year over the outlook period, to reach 3.2 million tonnes in 2026.
DISER added that nickel consumption finished at almost 2.4 million tonnes in 2020 (down 1.3% on 2019), after significant COVID-19 related consumption losses in the first half of 2020.
Going forward, growth is expected to be driven by returning economic activity and growing markets for nickel used in batteries. The surplus of nickel is expected to narrow in 2021, with the market likely reaching a deficit by 2023, and by 2026 world consumption is forecast to be 3.2 million tonnes, increasing by an average 6% a year.