In 2020, the nickel market was strongly impacted by the global slowdown caused by the COVID-19 pandemic. Lockdown measures implemented globally resulted in a reduction of end-use demand for nickel products.
However, nickel supply remained relatively unaffected and due to a surge in refined nickel production from Indonesia, supply grew by an estimated 4% in 2020. As a result, the nickel market was in surplus for the first time in four years.
Demand is expected to recover through 2021, largely dependent on successful vaccine programme roll-outs. Over the next decade, Roskill forecasts stainless steel will remain the main application for nickel, however lithium-ion batteries used in electric vehicles, will substantially increase its share in the nickel market.
Roskill believes that ESG will become an increasingly significant component of the nickel market over 2021 and the years to come, due to sustainability concerns related to nickel smelting and nickel laterite mining.
Tesla CEO, Elon Musk has demanded more sustainable sources of nickel and the company has now secured an advisory role at the Goro nickel mine and refinery in New Caledonia in an attempt to secure nickel units for lithium-ion cell production.