China stainless-steel demand to grow 40%

China stainless-steel demand to grow 40%

Bloomberg, Jakarta

PT Aneka Tambang, an Indonesian nickel and gold miner, expects consumption of stainless steel in China to grow 40 percent this year, boosting demand for nickel.

China will probably consume 5 million metric tons of stainless steel this year, Aneka Tambang's President Director Dedi Aditya Sumanagara said in an interview in Jakarta.

China may need "200,000 tons of nickel to fulfill this stainless-steel demand," Sumanagara said. "Although it is cooling down in China, we still have a good growth for nickel."

China's government has clamped down on lending to industries including steel and autos to damp an investment boom that it blames for power shortages, clogged transport networks and accelerating inflation.

Global stainless-steel demand will rise 6.1 percent this year to 22.6 million tons, according to U.K.-based consultant MEPS (International) Ltd. Nickel futures on the London Metal Exchange closed on Jan. 5 at $17,100 a ton, the highest since March 1989. Prices have since fallen 25 percent to $12,900.

Jakarta-based Aneka Tambang, which sells nickel to China, said in July production of nickel alloy used to make stainless steel may decline to about 8,000 tons from 8,933 tons last year because it shut a smelter for maintenance.