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Sinking ship buoys nickel prices

Stephen Beard Jan 24, 2007


BOB MOON: It began with a sinking ship off the coast of southern England. And that has been causing the price of a commonly-used metal to float even higher than it has been. As Marketplace’s Stephen Beard reports from London, part of the cargo is a massive shipment of nickel.

STEPHEN BEARD: The container ship The Napoli got into trouble last week and was run aground just off the Devon coast to prevent in from sinking.

The thousand tons of nickel on board is a lot of metal in current conditions. In fact it’s 20 percent of the stocks held by the London Metal Exchange.

Supplies are tight because of soaring demand for the metal to make stainless steel, especially in China and India.

Uncertainty about The Napoli’s load has now pushed up the nickel price a further 5 percent says Robin Bhar an analyst with UBS.

ROBIN BHAR: The longer it takes for it to be retrieved and be made available to the market, the longer it takes for that to happen, the longer the tightness persists for and the higher prices can be sustained for.

Salvage experts say it could take as long as a year to recover all the ship’s cargo.

About 100 containers-carrying consumer goods have already been washed ashore. Thousands of scavengers have made off with the contents including BMW motorbikes and crates of wine.

In London, this is Stephen Beard for Marketplace.

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