“If you are having to build a budget for [NEV] going forward, you can’t rely on nickel prices [and where they might be] in five years’ time, you need to lock in prices now,” Hawkes told delegates at an LME Asia Week seminar in Hong Kong on Thursday May 17.
He predicted that car manufacturers and battery manufacturers are “going to be looking to look to hedge and lock in [nickel] prices”, but added that interest in nickel will obviously depend on how the battery technology story evolves.
“In terms of fund interest, we are still seeing continued interest [from] asset managers looking to buy into the long-term [NEV] story and, therefore, invest in nickel,” Hawkes said.
The LME cash nickel price has risen more than 14% since the start of the year, surpassing $13,000 per tonne at the end of January and opening on May 17 at $14, 423 per tonne.
“I won’t be surprised if we traded back into the $13,000 [per tonne nickel] at some point, but I don’t think you can underestimate how powerful the [NEV] story is and the... impact it’s going to have on nickel prices until battery technology evolves,” he said.
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The new energy vehicle (NEV) story is not a “red herring” and nickel physical market participants need to lock in prices now , according to Robert Hawkes, executive director, Goldman Sachs International.