http://www.resourceinvestor.com/pebb...

Highlights:

"-Nickel prices have been falling since the end of 2007, which is mainly attributable to increasing nickel pig iron supplies and growing nickel production capacity. However, the plunge in nickel prices from more than $50,000 per tonne to about $23,000 per tonne has already made many high-cost nickel pig iron producers halt production in China, which may give some support to the prices," Zhong Yongqi, general manager of Shaanxi Energy Metals and Mining Resources Co. Ltd., said.

-Nickel pig iron, an innovative response to China's 2005 nickel shortage, will continue to play a role in the industry. Without nickel pig iron production, which is more than 80,000 tonnes per year, nickel prices will return to around $50,000 per tonne and $100,000 per tonne, said Stephen Barnett, president of the Nickel Institute.

-Compared with acid leaching of laterite ore and refined nickel from sulfite ore, the processing of nickel pig iron from laterite ore in China is the most expensive, due to the surging coke, electricity, freight rates and environmental restrictions.