Shares in nickel producer, Western Areas rose 2.4% on Thursday after the company’s upbeat remarks on the nickel price.
The company said market fundamentals appear strong despite volatile conditions in the first half caused by geopolitical factors – such as tensions between the US and Russia as well as the US and China.
The shares finished at $2.13 on Thursday.
Releasing its December-quarter operating results Western Areas noted that global nickel stockpiles had fallen towards 200,000 tonnes during January, their lowest levels in more than five years, which it said demonstrated that demand was continuing to outstrip supply.
“Encouragingly, the nickel price has started the new calendar year on a positive trend, with stainless steel consumption remaining healthy and the outlook for nickel-intensive electric vehicle battery demand remaining promising,” the company said.
Prices have risen from below $US10,500 a tonne late last year to $US11,615 this week.
Western Areas produced 5,415 tonnes of nickel in the quarter at costs of $3.15/lb – both within previously stated guidance.
CEO Dan Lougher said the company continued to deliver consistent operational performance in line with expectations for the first half.
“Pleasingly the quarter saw an increase in both nickel production into concentrate and nickel tonnes delivered into the company’s offtake contracts,” he said in a statement.
The company officially greenlighted its $300 million Odysseus underground project in October, reviving the historic Cosmos nickel complex near Leinster with early works already underway.
