SUPPLY NEWS - Jinchuan's nickel output to fall further in May - official

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Vivian Teovivian.teo@fastmarkets.comJoint News Editor - Asia

Singapore 04/05/2016 - Nickel output at Jinchuan Group could fall 1,500-2,000 tonnes in May from April due to a shortage of nickel ore, an official with China's largest nickel producer told FastMarkets.

Jinchuan's nickel production in April had already slipped to around 13,000 tonnes from 13,500-14,000 tonnes in March.

The company is facing a shortage of nickel ore due to production stoppages among sulphide ore producers in countries such as Australia and Brazil. Production at Jinchuan's own West One District mining area in China also remains suspended.

Late in November last year, Jinchuan along with seven other Chinese nickel metal and NPI producers, agreed to cut production by at least 20 percent this year.

And several nickel miners have announced production stoppages since the start of this year because of low nickel prices.

In January and February alone, at least four nickel miners announced the suspension of some operations. This includes Brazil's Votorantim and Australia's Mincor Resources, Panoramic Resources and Mirabela Nickel, which operates the Brazil Santa Rita mine.

Panoramic has a concentrate sales agreement with Jinchuan that ends once the decision is made to suspend operations at  its Savannah nickel sulphide mine in the East Kimberley region of Western Australia indefinitely, the miner had said.

Nickel demand in April had been strong relative to March but May sales could be about the same as or may slow down from April, the official added.

(Editing by Mark Shaw)



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