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28 May 2024

Nickel keeps on keeping on because the world needs nickel

There’s plenty of talk about the state of nickel. Boom talk, bust talk, somewhere in between talk.

With nickel exploration being one of the two stable exploration plays for BOA Resources, the other being lithium, we can’t help but weigh in on the need for nickel as we continue on the trajectory to create a greener future.

BOA Resources together with IGO is exploring for new nickel deposits in the Fraser Range. A deal struck with IGO in 2020 has seen IGO explore nine (9) of BOA’s 11 tenements in the Fraser Range.

BOA Resources plans to drill its Fraser South VHMS style looking project later this year.

So what’s nickel’s future? Let’s explore what the market is saying. In a recent article, Mining Dryblower’s column reported:

At any other time a 35% price increase in three months would correctly be called a boom.

What’s happening in nickel should provide relief for miners who have survived the crash of 2023, a horror 12-months during which nickel fell by 47.5% from around US$30,000 a tonne to $15,700/t.

The fall was actually worse than it looks because it occurred during a time of rapidly rising costs with the combined effect of a lower commodity price and higher operating costs resulting in a deadly squeeze on profits.

Meanwhile, well known industry analyst Gavin Wendt, Director of MineLife posted on Linked in on 18 May 2024:

No commodity keeps falling forever, and one current case study is nickel.

The metal has suffered in price terms from a large shadow of oversupply emanating out of Indonesia.

Despite persistent negativity, prices have started to turn, with political unrest in New Caledonia (the world’s number three nickel producer) being a catalyst.

Nickel has traded above $21,000 per metric ton yesterday for the first time in about a month. Whether this is a sustained recovery remains to be seen, and there could be more headwinds ahead, but what it does underline is that commodity prices can react very quickly.

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