• Nickel miner Mincor estimates production guidance of 8,000-10,000t of nickel in concentrate for FY23, perhaps lower than market expectations
  • In AUD  terms (Mincor’s sales price exposure) the nickel price has continued to trend upwards, appreciating ~8% over the quarter
  • Materials hammered in early trade Friday, down 3.3%


Mincor Resources (ASX:MCR) returned to the ranks of WA nickel producers in the June quarter after a six-year hiatus.

Nickel production for the September quarter was 928t and cash flows were $11.5m as the ramp up of its Kambalda ops continued apace.

The company now estimates production guidance of between 8,000-10,000t of nickel in concentrate for FY23, perhaps lower than market expectations, with the second half of the year likely to account for up to ~70% of that figure.

MCR has post ramp-up aspirations of up to 16,000tpa across two producing operations, Cassini and the Northern Operations.

But this is an important moment, MCR chair Brett Lambert says.

“Today we are also pleased to be providing the company’s first nickel production guidance, representing the first full year of production ramp-up at our Kambalda Nickel Operations,” he says.

“This is another important milestone for the company, as it marks our return from developer to consistent, high-grade nickel producer.”


Mincor enjoys surging Aussie nickel price

The long term thematic for nickel is bullish – Benchmark says we need 72 new 42,500 tonne nickel mines by 2035 to meet battery demand – but the short term ain’t bad either.

While USD nickel prices have remained reasonably static, in Australian dollar terms (Mincor’s sales price exposure) the price has continued to trend upwards, appreciating ~8% over the quarter.

“By quarter-end, the nickel price was trading at US$22,290/t, or A$34,282/t, well above the price assumed in Mincor’s 2020 Definitive Feasibility Study (US$15,750t/AUD$22,500/t),” it says.

“Continuing the trend observed over the past 12 months and reflecting the growing tightness in the physical market, LME nickel stockpiles steadily decreased, falling to 52,758 tonnes by 30 September 2022, representing considerably less than one month of global demand.”


Nickel Price /LME Inventory, last twelve months (London Metal Exchange)

READ: Why are metal inventories so low and what does it mean for base metals?


Materials trounced on Friday

Base metal prices fell by as much as 2.2% on Thursday with aluminium down the most.

The gold futures price also fell by $US3.60 an ounce or 0.2% to $US1,665.60 an ounce. Spot gold was trading near $US1,661 an ounce at the US close.

Meanwhile, iron ore futures fell by US75 cents or 0.8% to US$92.81 a tonne.

The S&P/ ASX Materials index was down ~3.3% in early trade Friday, dragged lower by … well, almost everyone.

Via CommSec.