Inco eyes China’s nickel market

Petroleum News Staff

Toronto-based Inco, the world’s largest nickel producer which expects to have two major projects coming on stream by 2006, believes China will soon be its largest customer.

Nickel is about to enjoy a period of strong and sustained demand, “fueled by the explosive growth of China and by a recovery in the world economy,” Inco chairman and CEO Scott Hand told the company’s annual meeting April 15.

“That demand is driven by the industrialization of China and its voracious appetite for stainless steel.”

He said Inco may build a processing plant in China to handle the bulk of production from its proposed Goro mine in the South Pacific country of New Caledonia, although work has been suspended with capital cost estimates heading for US$2 billion, 45 percent above budget. Inco is also moving ahead with its Voisey’s Bay project in Labrador.

But Inco shares, to the annoyance of investors, are still floundering around C$28 compared with a 52-week high of C$36.29 in June last year.