Nickel Gains to 3-Month High on IMF Growth Outlook Amid Ore Ban

Nickel rose for a second day to the highest level in almost three months as the International Monetary Fund boosted its global economic growth forecast and amid concern Indonesia’s ban on ore exports will cut supply.

The contract for delivery in three months on the London Metal Exchange gained as much as 0.4 percent to $14,790 a metric ton, the highest price since Oct. 23, and traded $14,760 at 11:39 a.m. in Tokyo. Nickel has added 6.2 percent this month, the most among the six main metals on the LME.

The global economy will expand 3.7 percent this year, compared with an October estimate of 3.6 percent, the International Monetary Fund said yesterday. Goldman Sachs Group Inc. boosted its 12-month nickel price estimate 6.7 percent to $16,000 a ton and said it was among its top three bullish metal picks for 2014. The ban in Indonesia, the world’s top producer from mines, started Jan. 12.

“With the global economy improving, nickel appeared to be the best metal on Indonesia’s ore shipment restriction,” said Hwang Il Doo, a senior trader at Korea Exchange Bank Futures Co. in Seoul.

U.S. gross domestic product will grow 2.8 percent, compared with 2.6 percent, while China will increase 7.5 percent, faster than the 7.3 percent estimated in October, though down from 7.7 percent last year, according to the IMF.

Copper for delivery in three months in London was little changed at $7,338 a ton. The metal for delivery in April rose 0.2 percent to 51,740 yuan ($8,550) a ton on the Shanghai Futures Exchange. The contract for delivery in March traded little changed at $3.3495 a pound on the Comex in New York.

Copper for immediate delivery settled at $64.50 a ton above the LME’s three-month contract yesterday, the widest backwardation since May 2012. Backwardation, a market structure in which prices of earlier-dated contracts are higher than deferred ones, signals limited supplies.

On the LME, aluminum, lead and zinc also climbed, while tin hadn’t traded.

To contact the reporter on this story: Jae Hur in Tokyo at jhur1@bloomberg.net

To contact the editor responsible for this story: Brett Miller at bmiller30@bloomberg.net

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