May 13 (Bloomberg) -- Nickel climbed for a sixth day to a 27-month high as Vale SA said operations remain halted at a plant in New Caledonia, further crimping supply that’s been hit by Indonesia’s ban on ore exports.
The contract for delivery in three months on the London Metal Exchange advanced as much as 3.4 percent to $21,625 a metric ton, the highest level since Feb. 10, 2012, and was at $21,200 at 4:05 p.m. in Tokyo. The metal jumped 53 percent this year, making it the best performer on the LME.
Vale’s operations on the South Pacific island are still suspended after a spill of contaminants last week, Cory McPhee, a Toronto-based spokesman at the company, said today. Indonesia, the biggest miner of nickel ores, banned shipments in January and Russia, currently under threat of sanctions after intervening in Ukraine, is the world’s second-biggest producer of the refined metal.
“Momentum in the market is hugely positive, based on sound supply and demand fundamentals, so more upside ahead,” said Gavin Wendt, the founder and senior resource analyst at Sydney- based Mine Life Pty.
Nickel’s 14-day relative strength index, indicating whether a commodity is overbought or oversold, rose above 90 today. It has exceeded 70, a level suggesting an impending drop to some analysts who study technical charts, since April 9.
“The price may test the $22,000 level soon before taking a breath,” said Hwang Il Doo, a senior metals trader at Korea Exchange Bank Futures Co. in Seoul. “To move up further from that price level, the market will need to see demand follow up.”
Copper in London fell 0.3 percent at $6,858 a ton after touching $6,895 yesterday, the highest price since March 7. The metal dropped for the first time in four days. China’s industrial-output, fixed-asset investment and retail-sales growth unexpectedly slowed last month.
The contract for delivery in July on the Comex in New York slid 0.3 percent to $3.141 a pound. In Shanghai, futures for delivery in August rose 0.3 percent to close at 48,170 yuan ($7,723) a ton.
On the LME, zinc, tin and lead gained, while aluminum was little changed.