The price of nickel has surged to its highest in a decade, as electric vehicle makers scramble to secure supplies for batteries amid booming car production and dwindling reserves.
The price of nickel on the London Metal Exchange jumped as much as 4.4% to $22,745 per ton on Wednesday – its highest value since August 2011.
The metal exchange reported that nickel stocks in warehouses it monitors have fallen for 51 consecutive days. Reserves of the metal in China – the world’s biggest battery manufacturer – are also reportedly approaching a record low.
Nickel is a metal that typically occurs naturally as ore, which must be mined, extracted and refined. It has many important industrial uses, such as in the production of stainless steel and batteries. More than 25 countries mine nickel, the largest producers being Indonesia, Russia and Canada.
Car manufacturers favor batteries with a high proportion of nickel, which bolsters their capacity, extending the range of electric vehicles and allowing them to do longer distances on one charge.
The International Energy Agency (IEA) estimates that demand for nickel could soar nineteen-fold by 2040 if the world’s nations proceed to fully meet the goals of the Paris Climate Agreement, by reducing greenhouse gas emissions and limiting global warming to pre-industrial levels.
Other commodities have also seen spikes in price. Copper rose above $10,000 on Wednesday, for the first time since October.
Oil prices also hit two-month highs on Wednesday, as crude inventories in the United States, the world's top consumer of oil, fell to their lowest levels since 2018.
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