Nickel prices move a few hundred dollars per ton in a day. For most of the
past decade, they have traded between $10,000 to $20,000. However, last
month, the Nickel prices went vertical and reached a price of $100,000 a
ton, majorly due to a short squeeze.
This huge short-squeeze triggered billions of dollars of losses, leading
London Metal Exchange (LME) to suspend trading and cancel all market
trades.
The stainless steel industry is the most affected as it imports nickel. The
stainless steel mills in India have been able to navigate the repercussions
of the spike in global nickel prices, partly because they rely on stainless
steel scrap as the main raw material, including nickel. Therefore, they don’t
need to source pure nickel. Also, the industry has been able to tide over
the crisis by moving to another grade of stainless steel, which does not
require a high quantity of nickel.