Reuters new agency reported that U.S. nickel premiums have fallen below 20 cents per lb for the first time in more than two years as an overhang of supply has slowed spot activity.
Market participants said that "In the higher volume arena, the bigger stainless mills are able to buy at the sub 20 cent level today. Producers have an overhang of material without a lot of spot business coming in to take any additional tonnages they might have."
Most participants pegged premiums for melting grade nickel in a range of 15 to 25 cents per pound, down from a first quarter range of 20 to 25 cents, while some small-lot spot deals were being quoted as high as 35 cents.
A second dealer said that "There are great economic uncertainties and people are not buying too much further out, but they still need metal and are buying it for prompt delivery."
Still, suppliers are said to have enough nickel on hand, and are more willing to move it in order to avoid getting caught long the metal.