Nickel is a hard metal whose most important properties are its strength, toughness and its resistance to corrosion and oxidation at high temperatures. Nickel is primarily used for its alloying properties which enable it to impart strength, toughness and corrosion resistance and to improve high and low temperature properties. Approximately two-thirds of the nickel consumed in the western world is used in the manufacture of stainless steel. The remainder is used in low-alloy steels, nickel based alloys, copper-based alloys, electroplating and various other products such as batteries and catalysts.

Outlook
Between 2003 and 2005 nickel consumption in stainless steel production is forecast by Brook Hunt & Associates Ltd. to grow by 3.6% per year on average, lower than the expected average growth in austenitic stainless steel production of 6.4% over the same period. Aside from the reduction in the nickel content, this reflects a sharp increase in the use of stainless steel scrap. Over the same period, growth in scrap consumption, both revert and external, is expected to average just over 7% per year.

Over the long term, consumption of primary nickel in the western world is forecast to grow on average by 3.4% per year between 2003 and 2014. This average growth rate is below the historic long-term average of approximately 4% per year. The slower average growth reflects the continuing shift in nickel demand away from the western world towards China. By 2014 primary nickel demand in China is expected to reach 221,000 tonnes, compared with 97,000 tonnes estimated for 2003. The average growth in primary nickel demand for the world is forecast at 3.8% per year between 2003 and 2014.
 
Loading nickel
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Between 2003 and 2014 growth in stainless steel demand in the western world and China is expected to average less than 6% per year. This is comparable to the 5.6% per year average growth recorded between 1988 and 2000. For the western world, the average growth in stainless steel demand is forecast to be 3.5% per year, compared with the long-term historic average of 5% per year. While it does reflect some element of product maturity, it further reflects the continuing shift in the use of stainless steel towards China. Over the forecast period Chinese stainless steel demand is forecast to grow by 12% per year, down from 17% per year average growth over the 1988 to 2000 period.

Between 2003 and 2014, western world stainless steel production is forecast to grow by less than 5% per year. The higher growth in production compared with demand reflects that the western producers will continue to export large volumes of stainless steel into the Chinese market. Between 2003 and 2014 exports to China are expected to grow by 10% per year.

The use of nickel in stainless steel production in the western world is forecast to grow by 4% per year on average, less than the average growth rate predicted for stainless steel production. This is the result of the growing use of secondary nickel units. The consumption of nickel in scrap is forecast to grow from approximately 592,000 tonnes in 2003 to approximately 1,013,000 tonnes in 2014. Over this same period, the scrap ratio is forecast to average 46.2%, compared with less than 46% over the 1990s.
 



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