Perth, Western Australia, Australia. Chinese nickel heavyweight Tsingshan Holding Group was looking at an $8 billion trading loss after nickel prices suddenly exploded higher following Russia 's invasion of Ukraine, The Wall Street . The LME is now very likely going to die a slow, self-inflicted death through the loss of confidence in it and its products, predicted Thompson in a tweet. Our marketing business markets nickel and nickel concentrates, as well as by-products and ferronickel. On Monday, a week after trading had been suspended, Xiang was close to securing a loan facility from JPMorgan Chase and other banks that would allow him to maintain his short position and could lead to the market reopening. Born in 1958, Xiang founded his business more than 30 years ago as a workshop making frames for car doors and windows in Wenzhou, eastern China. The total volume mined by Glencore in 2021 fell compared to 2020, in part due to supply chain problems and the closure of some mines. As of the evening of March 13, the LME had yet to announce a date for nickel trading to resume. The fallout was immediate. Tsingshan is an excellent Chinese enterprise.. Miners, traders, and manufacturers often use the market to make short betsthat is, to make money when prices fall. However, Xiang believed the risks to be manageable, the people said, even as an unidentified nickel stockpiler controlled at least half of the inventories on the exchange. The price move on March 8 created a systemic risk to the market, the LME said two days later. Our positions and operations dont have any problems, Xiang Guangda, who is also the Wenshou-based companys founder, told Yicai Global yesterday. Production 2019. Source: LME. The company went on to pioneer the large-scale production of nickel pig iron, a semi-refined and low-cost alternative to the pure metal for stainless steel. Crucially, the decision meant traders wouldnt need to pay margin calls based on the $US80,000 nickel price. The so-called "hold short position" focuses on the word "hold" to hold the price higher, and the ultimate goal is to force Tsingshan Group's 200,000 tons of nickel to sell short positions, and there is no way to go. Your email address will not be published. One resolution to the situation may be for Glencore and Xiang to strike a deal to use Glencores long positions to cancel out some of Xiangs short. Once its industrial complex reaches peak p. People forgot that this isnt a video game retailer; its an important physical commodity.. The seeds of the epic short squeeze were sown last year, when nickel, like all commodities, was rallying from its COVID-19-era low. The wild rise of nickel drew comparisons to the short squeezes in meme stocks such as GameStop that gripped retail investors for much of last year. 4 354 . Vale and Glencore announced today that they've entered a partnership to begin a feasibility study to explore Nickel Rim South. Rio Tinto, the world's second-largest mining company by market capitalization, last week said it would lift annual capital investment to as much as $10 billion in 2024 and 2025, up around 25% on . Earlier this week, nickel prices in London spiked byas much as 250%in little more than 24 hours. Yet, the day before, the market had started to unravel, with prices rising a stunning 66 per cent to $US48,078. At that time of day, bleary-eyed traders are typically just glancing at prices as they swig coffee . Glencore has a short interest ratio ("days to cover") of 0.2, which is generally considered an acceptable ratio of short interest to trading volume. Effectively, it rewound the market to the moment when prices closed on Monday at $48,078. But while the short squeeze has weighed on Tsingshans short-term cash flows, strong nickel prices are to its advantage in the long run. 6W - 9M. Xiang was aware of flaws in his strategy, people familiar with the matter said. Cobalt. Short Term. Resetting your password will log you out of all your active Yicai Global sessions. Born in 1958, he started out making frames for car doors and windows in Wenzhou, in eastern China. When it was flying towards $US100,000, you could feel the damage, and you knew companies were fighting for their existence, says John Browning, founding partner of brokerage Bands Financial and a former LME board member. For Xiangs big short position, that was painful. Now, the traders watched with a mixture of horror and grim fascination as the price went vertical. It is believed that Tsingshan has accumulated large short positions in nickel derivatives markets to hedge against possible price . MMC Norilsk Nickel Recent Development 11.3 Glencore 11.3.1 Glencore Company Detail 11.3.2 Glencore Business Overview 11.3.3 Glencore Nickel Mining . Glencore is a leading producer and marketer of nickel globally and Wayne has responsibility for the operation of mines and processing facilities in Australia, New Caledonia, Canada and Norway. Some hedge funds were buying nickel contracts in a bet on the electric vehicle boom. A Glencore spokesman declined to comment. Nickel Rim South Mine. Glencore UK Ltd, Izimbiwa Coal (Pty) Ltd, Katanga Mining Limited, Kazzinc Ltd., Koniambo Nickel S.A.S., Magdeburg, Mangoola Coal Operations Pty Limited, McArthur River Mining Pty Ltd, Minera . LME brokers and their clients were hit with margin call after margin call. Their GLEN share price forecasts range from GBX 540 to GBX 740. Glencore plc was newly . Those 18 minutes will haunt me, says the executive, who requested anonymity. Learn how we produce copper and the uses it is put to. Tsingshan mostlymakesstainless steelthat isused inthepetroleum, chemicals, auto,and other fields. But much of Chinas academic and business community did not believe Russia would attack its neighbour. But the effects of the short squeeze are likely to be felt in other ways. Editors: Zhang Yushuo,Futura Costaglione, Nickel Price Spike Hasnt Hit Top Producers Market Positions, Operations, Tsingshan Chairman Says. Now they had to pay big margin calls on the exchange while receiving no margin from their client. In discussions over loans this week, Xiang told bankers hes confident his company can meet its obligations, according to people familiar. 2017 - 2018 Yicai Global, Yicai Media Group. Beijing is supportive of him, Xiang told contacts recently. 20 kt/a nickel in concentrate) and Fraser Morgan (ca. WATCH: The Chinese tycoon, known as Big Shot in commodities circles is said to be facing billions of losses. The company has assured creditor banks in China that its . UNFORGIVABLE, tweeted Mark Thompson, a former trader at Trafigura and Apollo. Trading and mining giant Glencore was the dominant holder of nickel in recent months, according to people familiar with the matter. Then, as now, a key factor was the intervention of the exchange. Overseas market players have made some moves, Xiang said, driving up nickel prices in the last two days. But today things have reversed, that is, Tsingshan Group has prepared 200,000 . 115 000 MT. Project manager for transition of Sudbury INO from CAMP to Deswik. The operations also include the Sudbury smelter. Earlier this week, nickel prices in London spiked by as much as 250 per cent in little more than 24 hours. Discovery of the deposits is credited to Murray Edmund Watts in 1931 or 1932. Finance > Capital-markets. Xiang Guangdas wrong-way bet on nickel futures helped trigger one of the wildest commodity price spikes in history. Now, the traders watched with a mixture of horror and grim fascination as the price went skyward. It was a classic short squeeze, as the pain for Tsingshan, its brokers, and other shorts created a self-reinforcing cycle. By now, Tsingshan wasnt the only nickel company that was strugglingjust the biggest. Beijing is supportive of him, Xiang told contacts recently. Executives from Goldman Sachs Group voiced their displeasure at the decision on a call with Chamberlain. Worse, the chaos was spreading to other markets: Zinc prices spiked 15% in a few minutes to a record high, only to collapse again. The show will focus on global macro issues with a middle eastern context, provide expert analysis of major market moving stories and speak with the biggest newsmakers in the region. For participants in commodities exchanges, a price rally is not necessarily good news. The head of one London metals brokerage recalls feeling sick as he watched the moves, realizing what the spike in prices would mean for his company, the market, and the global metals industry. Our nickel operations are in Canada, Australia, Norway, and New Caledonia. Market speculation has it that Tsingshan has a short position of about 200,000 tons of nickel, which it cannot deliver due to a lack of spot product after being assailed and squeezed out by US and European commodity futures giants such as Glencore, China Securities Journal reported yesterday. Others in the market may also push up prices in anticipation of that short covering. Then on March 7, nickels price began its parabolic ascent, surging from $US30,000 a tonne to more than $US50,000. Miners, traders, and manufacturers often use the market to make short bets that is, to make money when prices fall. Coal Department. Company says it puts it into the league of the largest undeveloped nickel deposits in the world. Its also one of the most important raw materials needed in making batteries for electric vehicles. The company has a diversified basket of commodities, including nickel, which is famous because of electric vehicles. While few observers believed Xiang could reach that level of production, he was confident. Perhaps what's most surprising is that this nickel squeeze happened within a market that had, for the last few years, been comparatively sedate, with rangebound trading rarely breaking above the $20,000/metric tonne (mt) mark on the upside before 2022. By Lucy Battersby. Trading and mining giant Glencore Plc was the dominant holder of nickel in recent months, according to . Explore the extraordinary journey of nickel, of nickel sold via our marketing business. On average, they predict the company's share price to reach GBX 620.91 in the next year. Shanghai's most-traded nickel futures contract . He draws a comparison with Silver Thursday, the day in 1980 when an attempt bythe Hunt brothersto corner the silver market came unstuck. People familiar with the discussions said the exchange would ideally prefer to wait until Xiang has reached a resolution with his banks and brokers. . If you don't see the email, check your junk, spam or other folders. Glencore Nickel. Activity . Glencore's original trading business is still a powerhouse and is . He draws a comparison with Silver Thursday, the day in 1980 when an attempt by the Hunt brothers to corner the silver market came unstuck. The LME canceled transactions and suspended trading Tuesday after nickel's price jumped 90% to $55,000 per metric ton Monday, and then leapt again to a record high of $100,000 the next day . Furious investors and traders. Certain sections of this system have been patented. Most market participants expect nickel prices to come back down once the crisis around Xiangs position has been resolved. Despite the recent upheaval, his company still remains the biggest in the nickel industry. Xiang Guangda, the billionaire owner of Tsingshan Holding Group. Despite the recent upheaval, his company still remains the biggest in the nickel industry. Nickels price moved sharply higher in the week after Russias military invasion. The price was frozen, below the record high but still at $US80,000 a tonne. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); Si estn subiendo los predios de los metales y dedcuieto nuevas forulasparavas frmulas paraformar y tranformar los metales megustaria encontrar una empresa ,organizacin,para si le interereza ase un tratado denegosiar un trato demostraciones y prbarles yensearleslo que estudie transformaciones aliaciones dijitales y la fabricacionde. All prices are listed in Australian Dollars. Evaporating liquidity. The annals of commodity markets are full of tales of producers and traders, fromMetallgesellschafttoSumitomo, that blurred the lines between hedging and speculation and ended with billions of dollars in losses. In cobalt, a Chinese state-owned firm is also quite large, but Glencore is still the largest producer of cobalt in the free world. A year after the short squeeze that brought the LME to the brink of collapse, the nickel market remains barely functional, with trading volumes sharply lower and prices regularly experiencing wild . As at January 31, 2023 Glencore holds 72,008,404 Common Shares, representing approximately 70.8% of the issued and outstanding Common Shares. Now they recognised that they had to suspend trading. The exchange had serious concerns about the ability of market participants to meet their resulting margin calls, raising the significant risk of multiple defaults. Despite that, Chamberlaininsisted to Bloomberg TVon March 9 that the solvency of the LME itself was never in doubt. Nickel prices usually move a few hundred dollars per tonne in a day. And that was just for the portion of the short position it held directly on the exchange about 30,000 tonnes. As the trend towards e-mobility grows, this versatile metal is increasingly needed to produce high-performance batteries. At that time of day, bleary-eyed traders are typically just glancing at prices as they swig coffee on their way to the office. Nickel is also used in certain types of steel which lower magnetic properties. Provided short/mid/long/strategic schedules using Deswik. In the short term, apackage of loansfrom Chinese and international banks will help Tsingshan meet its immediate liquidity squeeze. Nickel prices usually move a few hundred dollars per ton in a day. The LMEs history dates back to the early 19th century, when metal traders drew a circle in the sawdust on the floor of the Jerusalem Coffee House in the City of London. Mark Hansen, chief executive officer of Concord Resources. Neither party seems very keen on this idea, however. Most analysts sided with Xiang, at least in the medium term, believing that nickel production led by Tsingshan and its competitors in Indonesia would outpace demand. Iquique Chile Falconbridge . Hes in the physical nickel business. Wayne has over 20 years of operational management experience of complex hydrometallurgical plants, specialising in transformation of operational and . Hansen of Concord Resources argues that financial investors who traded nickel last week should have been prepared for the LME to step in. Funds were buying nickel contracts in a day industrial complex reaches peak p. people forgot that this isnt video! 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