Nickel Usage | Nickel Production | Nickel Price & LME Stocks
Nickel Usage
Nickel is a lustrous, silvery-white base metal whose chief properties include a high resistance to corrosion and oxidation allowing for long life durability, and a relatively low thermal conductance making it suitable for use in high temperature applications.
Nickel is rarely used in its purest form. It is an attractive and durable pure metal that readily alloys with many other metals, such as iron, chromium and copper, to produce alloys with properties that cannot be achieved by pure metals. It is also used in plating applications and in rechargeable batteries.
Nickel is one of the most versatile metals. It is both hard and malleable, resists corrosion and maintains its mechanical and physical characteristics even when subjected to extreme temperatures.
Nickel is widely used in various consumer, industrial, military, transport / aerospace, marine and architectural applications, most visibly alloyed with steel to produce stainless steel where resistance to corrosion is a key requirement.
In 2007, some 59% of the annual global nickel production was used to manufacture stainless steel, with another 21% as other steel and non-ferrous (including ‘super’) alloys. The remainder was used in nickel plating applications (11%) and in the production of coins and Ni-based chemicals (9%).
Source: International Nickel Study Group (INSG), 2007
Nickel Production
Nickel is largely produced from mining either sulphide or laterite deposits.
Nickel sulphide deposits are typically associated with mafic and ultramafic igneous rocks from which Ni-bearing sulphide mineralization was deposited through magmatic processes. The nickel grade of sulphide ore typically ranges from 1-2%. Nickel sulphide deposits are mined by underground and open pit methods. The mineralization is separated from associated waste rock to produce a concentrate (8-14% Ni) for transportation and sale to smelters and refineries for final processing to pure nickel.
One of the advantages of producing nickel from sulphide ores is that a number of the global nickel refineries are dependent upon third-party nickel feeds to fill their capacities.
Laterite deposits are formed from prolonged surficial weathering of ultramafic rocks that are or have been located in tropical climates throughout geological time. The prolonged weathering chemically and mechanically upgrades and concentrates the natural nickel content of the original rock. Nickel laterite ore deposits are very large tonnage, low-grade deposits located close to the surface. Ore deposits of this type are restricted to the weathering mantle developed above ultramafic rocks. As such they tend to be tabular, flat and large, covering many square kilometres of the earth's surface. The nickel grade of lateritic ore ranges from 0.75-1.5% and the typical nickel laterite mine generally operates an open pit mine.
The primary difference between the two ore types is that laterites are not readily upgradeable to a conventional high-grade concentrate product and therefore must generally be processed to an intermediate (ferronickel or nickel matte), or a finished product at site utilizing large, complex metallurgical processing facilities. This tends to greatly increase the capital required to develop a laterite deposit relative to a sulphide deposit.
In general, there can be byproduct credits when processing both ores. Sulphide producers can have higher direct production costs because they are often underground operations, but lower net production costs because of significant byproduct credits which can include copper, cobalt and platinum group metals. Laterite producers can often recover cobalt as a byproduct.
In 2006, spurred by LME nickel prices which began rising towards $25 per pound, a significant new development occurred with respect to the supply of nickel from convention sources. The Chinese developed new sources of nickel as the primary nickel supply was insufficient to support demand. The approach involves the direct shipping of low grade nickel laterite feed (<2% nickel content) from the Philippines, Indonesia and New Caledonia to produce a low-nickel, high-iron product (nickel pig iron (NPI)) that is used by the Chinese stainless steel industry. One of the key features of this new production is that it has a relatively low (capital) cost of entry. In 2009, NPI production was estimated to be about 100,000 tonnes of contained nickel, or roughly 8% of global nickel capacity. The supply is flexible, depending upon the nickel price. The estimated breakeven cost for this production is around US$9.00 per pound.
Nickel sulphide deposits have historically been and are currently the dominant source of mined nickel generally accounting for some 58% of total mine production versus 42% derived from laterite operations. In terms of remaining global resources however, laterite deposits account for >70% while sulphide deposits account for <30% due to a long history of exploitation.
Source: INSG
Nickel Price & LME Stocks
Source: MetalPrices.com
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