Blood Nickel: Car Manufacturers Distancing Themselves!

Recording date: 20th June 2024

Nickel — I was wrong on the short-term move. I got the dip below $19K but didn’t see it breaking down all the way to $17,300 (just under $8/lb). It's still 15% off the lows and generally in place where expected. The drop in the lithium price is taking some steam out of restocking, but according to INSG, nickel demand was up 9% in Q1.

With the drop in nickel price, discounts on NPI narrowed further – again, expect to see continued convergence throughout the year. Stories this past week from the Indonesian nickel conference around preserving high grade, high grade running out by 2029 (I don’t think that is the case, but declining grades will continue to happen and is one of the factors most analysts are not factoring into Indonesian production). Other big news from the Indo conference was a discussion of a moratorium on new NPI smelters being considered – the question of whether it will apply to already permitted facilities or just new permits

Big news of the week was the Bloomberg story and video – great insight into labour, environmental and community issues caused by nickel mining.

Story: https://www.bloomberg.com/features/20...

Video:    • The Dirty, Deadly Side of China's Ove...  

Plug-in vehicles were up 30% year over year in April, with BEVs up 14% year over year and Plug-in hybrids up 51% year over year. China drove EV sales up 30% year over year, while ROW major markets were up 5%.

Chinese stainless steel production is up 12% YTD May, with 300 series up 15%YTD May.

Bad forecasts – CRU did June quarterly update – surpluses in 2-3% per year, have total demand down to 4-5% by 2027-28 driven by stainless production growth down to 2-3% per year – makes no sense.

Company News

Magna Mining announced the award of advanced exploration mining with a surface bulk sample of approximately 20,000 tonnes from the 109-footwall zone. The mobilization and site preparation are scheduled to begin in June, with drilling and blasting commencing in July, followed by processing at Glencore's Strathcona facility. The initial capital required to commence the surface bulk sample program at Crean Hill is expected to be financed from Magna's existing cash balance.

EV Nickel surface samples - of the 148 samples submitted for analysis, 123 of the samples were from the targeted peridotites and dunites, where 79% of the assay samples graded 0.24% nickel or better, ranging from 0.15% Ni to 0.34% nickel, indicating that the CarLang B area represents another potential zone of similar grade material as the Company's flagship CarLang A Deposit.

In Australia, Western Mines Group halted stock for release by Monday. It will be interesting to see what comes out. The stock had hit some higher grade at contact of the disseminated Mulga Tank orebody.

Earlier in the month, Lunnon Metals put out resources on Baker – at the south end of structures in Kambalda which host Beta Hunt - 1 million tonnes @ 3.3% nickel +Cu, Co.

Some financings - Power Nickel $20 million flowthrough, Premium Nickel’s $15 million first tranche.

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