admin
Enacy Mapakame: Business Reporter
NICKEL producer, Bindura Nickel Corporation says sales increased 53 percent to 2 852,17 tonnes in the first five months of the year compared to 1 864 tonnes sold in the same period last year. In the period to June 30, 2016, Trojan Mine produced 97 689 tonnes of ore and milled 101 433 tonnes.The mine has an estimated 6,410 million tonnes of ore reserves, an average grade of 1,61 percent and life of mine of about nine years.
Average nickel price for the quarter was $5 728 per tonne, which was 3 percent higher than the average price of $5 520 per tonne which was realised during the quarter to March 30.
The group anticipates average nickel price per tonne will be $6 304 by end of this month.
Nickel prices had remained depressed last year on the back of historical high nickel stocks, lack of producer supply cuts and replacement of Indonesian ore by Philippine ore.
The Philippines accounts for 24 percent of global nickel demand.
Average LME cash settlement price fell by 22,63 percent to $9 412 per tonne compared to $12 175 per tonne during the same period last year.
LME metal prices fell to seven year lows before regaining to a nine month high in July 2016.
Like many companies operating in challenging environments, cost containment measures have proven to be one of the ways of preserving cash.
Last December, BNC retrenched 300 employees and outsourced development services in the mining department to a contractor company effective June 1 2016, resulting in the company saving close to half a million dollars.
“This has resulted in cost savings worth $400 000 which would otherwise have been incurred in retrenchment costs.
“A new culture, anchored on the principle of improved accountability is emerging,” said BNC chairman Yim Chiu Kwan.
Meanwhile the Hunters Road Mine open pit is expected to have a production rate of 0,72 million tonnes per annum during the first four years of production.
The figure is expected to increase to 1,2 million per year as it gradually rumps up to full production of 1,2 million tonnes in ten years time.
“This will give Hunters Road a life of mine of 22 years,” said Mr Kwan.
The sector sees bright prospects as the recent increase in prices has resulted in increased interest in commodities by traders.
According to the International Nickel Study Group, global nickel market will be in deficit this year due to reduction in supply, increased production of austenitic stainless steel grades and a sustained positive trend in demand in the battery sector.
Analysts believe nickel is entering into a bull cycle.
Online Reporter