ATI secures nickel ‘safety stock’: Wetherbee

“This will ensure an uninterrupted flow of materials to meet increasing customer demand,” he added, pointing to “disrupted availability” and noting that nickel prices rose by more than 30% in March.

Goldman Sachs in late April forecast that the Class 1 nickel market faces a 196,000-tonne deficit in 2022, up from a 185,000-tonne deficit in 2021.

Pittsburgh-based ATI also reported significant price increases for other key raw materials – including cobalt, ferro-chrome and molybdenum – in the first quarter.

ATI therefore “raised prices to offset the additional raw material, labor and supply-chain costs we’re experiencing,” Wetherbee said. “In product lines with fewer long-term customer agreements, we’re able to fully offset inflation in the first quarter.”

In product lines with long-term agreements, however, where the impact of higher costs will lag “about a quarter,” ATI’s future earnings could be affected, he said.

The CEO also said he expected the company’s customers to rethink global supply chains and reallocate some of their demand for raw materials – especially titanium – to western suppliers.

ATI reported net income of $30.9 million on $834.1 million in sales in the first quarter, reversing the $29.8-million loss on $765.4 million in sales reported in the fourth quarter of 2021. The first-quarter results also mark an improvement from a loss of $7.9 million on $692.5 million in sales in the first quarter of 2021.