Disruption in New Caledonia's No. 3 mining industry has reduced production and nickel prices have skyrocketed

Concerns that supply from French territory will be further interrupted due to the turmoil in New Caledonia grew, and nickel surged by 5% or more, and recorded a high value in a month.

The South Pacific Islands were the world's third largest producer of battery metal for electric vehicles last year, but this week they have been hit by violent protests due to changes in voting rules. This is due to the suspension of production of the French mining company Elamet SA, and the company is operating local units with minimal production capacity.

Nickel futures prices rose by up to 5.7% on the London Metal Exchange, making it the largest intraday rise since April 15. As of 8:7 a.m. in the British capital, it has risen 5.5% and is traded at 2880 dollars per ton. Other base metals also rose, with aluminum and copper rising 1.1%.

New Caledonia's nickel production had already been cut due to sluggish consumption in the battery sector and a sharp drop in prices due to the supply boom in Indonesia. Since then, LME prices have surpassed $20,000 per ton for the first time since September due to delays in mining permits in Southeast Asian countries and Russian sanctions against metals.

Horizon Insights analyst Gao Ying said, “Nickel is catching up with other base metals.” “The incident in New Caledonia has caused some disruption to the nickel market, which has further accelerated price increases.”