The London Metal Exchange (LME) nickel futures price continued its upward trend yesterday (September 24), up by US$63 to close at US$15,417/ton, the highest level since July 25.

Despite a strengthening US dollar, nickel prices rose due to China's central bank maintaining ample market liquidity, which improved sentiment across the base metals market, and Indonesia's sanctioning of 39 nickel mining companies.

However, market participants said that the sanctioned Indonesian firms are small, suggesting the overall impact on global supply will be minimal. The price increase occurs as LME inventory levels continue to climb, adding another 132 tons to reach 230,586 tons. The market is generally expected to trade sideways in the short term.