Mr Wang Weil deputy director of the stainless steel branch under China Metals Materials Trade Association said that "Nickel is going more and more estranged from the stainless steel market."

He said that as the modern metallurgical technology and processing craftwork advance, development and application of nickel free stainless steel ferrite is better acknowledged, which may suggest less use of nickel in stainless steel production in future.

Mr Wang said that in US, Japan, South Korea and other developed countries have all accelerated research, production and application of ferrite stainless steel, and the ratio of this stainless steel variety may reach 50% to 60% from current 30%.

On the other hand, nickel is also being replaced in austenitic stainless steel. When the nickel price is over USD 20,000 per tonne, it'll be quite economic to use manganese as a substitute. Meanwhile, chrome manganese nickel stainless can use ferronickel instead of pure nickel, so as to reduce demand for the latter.

He said that "As the largest nickel consumer, stainless steel makes up 66% of the global nickel consumption in 2008, or 69% in China. In this case, nickel use reduction in stainless making may hurt the nickel demand badly. This year, stainless steel output is predicted at 7.1 million tonnes, down 6.6% from the year before, consuming nickel of some 214,000 tonnes, in line with last year's."