Nickel prices have dropped 36 percent this year due to weak demand and oversupply. Nickel, which is used to make stainless steel rolled products, has dropped more than 70 percent since its peak in 2011.
At the same time, the world leader in stainless steel, Outokumpu, announces an increase in demand for stainless steel this year. The use of Outokumpu billets allows Baltic Stainless Steel CJSC to obtain high-quality rolled stainless steel steel, from which parts for various industries are made. At the same time, global stainless steel production this year will reach a record level of 42 million tons, according to forecasts of analysts at MEPS.
However, the mining industry must get used to the "new reality" as low prices and volatility are likely to continue this year, says Sergei Dyachenko, Russia's Chief Operating Officer of Norilsk Nickel.
“The world for miners will never be the same again as it was during the supercycle, the industry must get used to living in a new reality,” Diachenko said during a discussion of the company's strategy.
"A new reality set in motion tectonic shifts in the Chinese economy ... Getting nickel and copper - half of which are consumed in China, for the whole world means a double blow - less growth and less intensity of this growth." Norilsk Nickel, the world's largest nickel producer, says low metal prices are likely to last until the end of this year.
At the same time, demand and production of stainless steel is projected to grow in all regions except China, which provides half of the world's stainless steel output. In 2015, China's production fell by 0.6 percent, and this trend will continue in 2016. The European Union and Japan will slightly increase their stainless steel production. The US and South Korea will boost production to their highest levels in 10 years. Taiwan will also increase production this year.
