Nickel

Stephen Freeman

Western Thunderer
Good Morning,

With all the talk about the move to electric cars etc and the Russian situation, the price and supply of Nickel is starting to become problematic (I think it probably is already really).

Now that it is needed to go into lithium ion batteries and is used in the production of stainless steel, does anybody know what the percentage of our rail is and if it is likely to become a problem?
 

daifly

Western Thunderer
HiNi rail is c18% Nickel. Australia, Indonesia, South Africa, Russia and Canada account for more than 50% of the global nickel resources so it's the usual short-term commodity market reaction when one of several sources becomes unavailable.

I'm not losing sleep over the price of rail.

Dave
 

simond

Western Thunderer
I wouldn’t worry, though I have no doubt the price will increase. Main uses are cutlery, jewellery & musical instruments.

Nickel silver - Wikipedia shows that typical Nickel Silver is about 20% nickel. Nickel was typically about 50% more expensive than copper, it’s used extensively for the interconnects between cells in lithium batteries, as it is easy to form, and importantly, easy to weld, but the conductivity is not as good as copper.
 

Focalplane

Western Thunderer
INCO developed a huge nickel mine in Sulawesi, Indonesia. I flew there once in the mid 1970s and it was indeed huge. It's even bigger now and even Google Street View has been there! The reason there is so much nickel in Sulawesi is entirely due to a massive plate tectonic collision which brought deep seated rocks to the surface. The greatest problem is its location, very remote and mountainous. Furthermore, to increase the value of exports the ore now has to be processed in country which requires electricity. Gas reserves in South Sulawesi would have done the job but INCO decided hydro electricity would be more reliable and closer to hand. So the gas remained undeveloped for decades. Street View images of where I worked in Sulawesi are unrecognizable.

I agree with Simon and Dave, nickel is one product that is in relatively safe hands. However, the old family electroplating business in Birmingham often stock piled nickel anodes in times of trouble as the price does fluctuate. Although fewer articles are chrome plated these days, chrome needs to be deposited on nickel to create a good bond.
 
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daifly

Western Thunderer
Higher commodity prices mean the costs associated with recycling probably make recycling a more competitive option to reclaim these materials.

Dave
 

simond

Western Thunderer
Interesting, but I suspect the real culprit is not a real shortage of the material, but simple, old-fashioned greed…

“The price shock happened partly because a Chinese firm, Tsingshan Holding Group, had built up a large "short position" in the market - in other words, arranging contracts that bet the price of nickel would fall. When it didn't, the firm was forced to buy back those contracts, or commit to supplying the nickel. Taking either option would result in a huge loss.”

of course, anyone whose business turnover and profitability depends on there being a scarcity of something will try to talk up the market too. I rather understand that the only reason diamonds are valuable is because they’re scarce, and the only reason they’re scarce is that the supply is controlled by very few players, none of whom want to see the value drop, so they don’t sell their stocks. And of course, their stocks are worth a fortune because diamonds are valuable.

I wonder what the world market for drawn NS rail for model railways is. Mr Blofeld is investigating…
 

simond

Western Thunderer
I’m not sure, I think, like most news organisations, they’re just looking for a headline.

I reckon the news would take no more than ten minutes per day (most days), if the media were only allowed to report facts, without opinion, emotion, obfuscation, deviation or repetition…. (Sounds of the minute waltz fading in the background) :)

probably a bit bland, but certainly efficient!
 

oldravendale

Western Thunderer
Interesting, but I suspect the real culprit is not a real shortage of the material, but simple, old-fashioned greed…

“The price shock happened partly because a Chinese firm, Tsingshan Holding Group, had built up a large "short position" in the market - in other words, arranging contracts that bet the price of nickel would fall. When it didn't, the firm was forced to buy back those contracts, or commit to supplying the nickel. Taking either option would result in a huge loss.”

of course, anyone whose business turnover and profitability depends on there being a scarcity of something will try to talk up the market too. I rather understand that the only reason diamonds are valuable is because they’re scarce, and the only reason they’re scarce is that the supply is controlled by very few players, none of whom want to see the value drop, so they don’t sell their stocks. And of course, their stocks are worth a fortune because diamonds are valuable.

I wonder what the world market for drawn NS rail for model railways is. Mr Blofeld is investigating…
To a degree this mirrors the situation in, if memory serves me right, around 1980 when the Bunker Hunts tried to corner the market in silver. Film manufacturers were in turmoil but Kodak tended to buy their silver on the futures market so had a relatively stable price. On the other hand Ilford bought on the spot market, prices went through the roof and (memory again) it bankrupted them - Ilford is not the same company as in 1980.

Subsequently there were inquiries in to nefarious goings on and the Hunts were declared bankrupt having started with a fortune of around $5bn. However futures markets continue to be big business and there's lots of cash to be made if you bet on the right commodities.

At the moment brass is expensive and that's probably down to the world market rather than futures. Don't expect your kits or the components thereof to show anything other than a price increase or two for a while.

Brian
 

Mudhen

Western Thunderer
I spent quite a proportion of my working career trading futures although mostly financial. Yes if you made the correct calls there was a lot of money to be made. But analyse statistics from the broking houses and you find that as many as 85% of speculators lose money and go out of business.
Used as a hedging instrument by producers and end users they can provide good financial protection against market fluctuations. For example the farmer whose land surrounds our house will sell wheat in the futures market for delivery sometime after harvest if the price exceeds his initial expectations.

all the best
Tim
 

Eastsidepilot

Western Thunderer
Interesting, but I suspect the real culprit is not a real shortage of the material, but simple, old-fashioned greed…
Like everything else we need or have to buy !. Oil, fuel, gas, electricity and dare I say food. The problem lays with essential products being traded as commodities by people with too much money that want to make more money, that's why most of us are poor buggers ! :D
 

Eastsidepilot

Western Thunderer
Like everything else we need or have to buy !. Oil, fuel, gas, electricity and dare I say food. The problem lays with essential products being traded as commodities by people with too much money that want to make more money, that's why most of us are poor buggers ! :D
shopping.png
............got the 'T' shirt :D
 

Genghis

Western Thunderer
At the moment brass is expensive and that's probably down to the world market rather than futures. Don't expect your kits or the components thereof to show anything other than a price increase or two for a while.
Brass and nickel silver etches up 15%, brass castings up 20%, whitemetal up 75%. It is hurting.

Dave
 

Rob R

Western Thunderer
To a degree this mirrors the situation in, if memory serves me right, around 1980 when the Bunker Hunts tried to corner the market in silver. Film manufacturers were in turmoil but Kodak tended to buy their silver on the futures market so had a relatively stable price. On the other hand Ilford bought on the spot market, prices went through the roof and (memory again) it bankrupted them - Ilford is not the same company as in 1980.

Subsequently there were inquiries in to nefarious goings on and the Hunts were declared bankrupt having started with a fortune of around $5bn. However futures markets continue to be big business and there's lots of cash to be made if you bet on the right commodities.

At the moment brass is expensive and that's probably down to the world market rather than futures. Don't expect your kits or the components thereof to show anything other than a price increase or two for a while.

Brian
We (ILFORD) were wholly owned by Ciba-Geigy at that time so they took the hit..
It was a couple of years before I started my apprenticeship there so it was all down after that..........

Rob
 

djparkins

Western Thunderer
Brass and nickel silver etches up 15%, brass castings up 20%, whitemetal up 75%. It is hurting.

Dave

White metal fell by 16% last week. Or at least what we procurred had. Etches are up as you say. With new stocks price increases will be inevitable. The old answer is the same answer - if you'll want it in future and can afford it now then buy it.

We have been a little protected up until now due to our throughput with the etchers for our military ranges, but that is also affected. The etchers are currently out of even some thicknesses of brass, let alone nickel silver. Sure you can get small sheets in short runs delivered from some etchers in a few days, but at prices and sizes that are just not viable for us in order to get a sensible mark up. If a manufacturer is part time then maybe.

Our main etcher is taking 10 weeks plus at present and the only option we have in order to [almost] always have stuff on the shelf for you guys, is to carry ever more stock and to order it well in advance. I guess the only silver lining is that it creates bit of a hedge against prices rising further - which they surely will!

The way I see it as a munufacturer is if you don't have the spare capital to tie up in stock right now, you are going to struggle in the future. Imagine supplying Americans on three-month lead in time - most don't even want the item by next week!

I don't see this ending any time soon as a perfect storm has arisen. We are committed to the hobby but nothing is making being a kit manufcturer easier at the moment - and don't even get me started on Making Tax Digital!

David Parkins
MMP/ABS et al
www.djparkins.com
 

Genghis

Western Thunderer
I thought delivery times were improving but it has still taken us 12 weeks to get the last batch of etches when previously 6 weeks was about average. We too have increased stock holdings to try to give a good service, but even that has a price. We have about £40k (at cost) of stock on the shelf at present, far more than is sensible. We do this to try to give a good service. To put this into perspective, in a normal pre-Covid year we would sell £40-45k of goods (at sale price). We did have an exceptional year last year though.

Interesting, and good news, if whitemetal is coming down again. In January we paid 45% more than we did last year and the last quote I had was up again (hence 75% quoted before). Things are certainly volatile at present.

David (Gladiator)
 

simond

Western Thunderer
I use PPD got etches for parts for our HV instruments - I’ll advise our buyer of possible delays.

thanks for the heads-up.
 

djparkins

Western Thunderer
I use PPD got etches for parts for our HV instruments - I’ll advise our buyer of possible delays.

thanks for the heads-up.

I don't think that applies to PPD - you had maybe better check first. I've always understood from what I read on this forum that their delivery is very quick.

But the sheet sizes don't match our films - and with over 800 films in production I don't fancy re-shooting them all - even if the prices were viable, which they aren't!

David
 

LarryG

Western Thunderer
PPD generally ask if etches are needed urgently and there is a premium to pay of course. But in general, PPD does offer a speedy turnaround. I can't even get a reply from PEC. G&H used to be quick as well, but it is ages since I ordered re-runs.
 
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