Nickel falls as Indonesia unveils plan to put export of nickel products under state control

Nickel declined on Thursday as investors assessed the supply of the metal and a new policy of top producer Indonesia to put exports of some nickel products under state control. The benchmark three-month nickel on the London Metal Exchange declined 1.39% to $18,665 a metric ton as of 0800 GMT. The most-active nickel contract on the Shanghai Futures Exchange declined 1.23% to close at 142,770 yuan ($20,986.33) a ton. Some details of the policy, announced by President Prabowo Subianto on Wednesday, were unveiled on Thursday by officials of the trade ministry and the chief executive of Indonesia's sovereign wealth fund,Danantara. A unit of the fund will become the sole exporter of palm oil, coal and ferroalloys as soon as September 1. Ferronickel, whose HS code covers nickel pig iron, will be put under the oversight of the state export body. It is a key feedstock for stainless steel and accounts for the majority of Indonesia's nickel output. Traders noted that nickel stocks SHFE are still on the rise, and are at the highest since May 2017. LME nickel inventories also ticked higher as of Tuesday. Meanwhile, implementation of the new policy is in focus, with some investors saying it could prove impossible to implement as they question how a single company could manage exports to a vast number of downstream buyers across the globe. The U.S. dollar and oil ticked higher, as President Donald Trump said the U.S. was willing to wait to get the right peace deal with Iran in the final stagesof negotiations, weighing on industrial metals led by copper. London benchmark copper tumbled 1.21% to $13,490 a ton, and the Shanghai most-active copper closed 0.38% higher at 103,940 yuan, after a 1.97% rise earlier this session. Elsewhere on the LME, aluminium dipped 0.28%, zinc dropped 0.75%, lead nudged 0.08% higher and tin slid 1.93%. Among other SHFE metals, aluminium dropped 0.49%, zinc rose 0.98%, lead added 1.07% and tin gained 1.81%.