Nickel drops to one-month low in London after stockpiles gain

Nickel fell to the lowest in a month after stockpiles gained on the London Metal Exchange, increasing supplies of the metal used as an alloy in stainless-steel making.

Inventory tracked by the LME climbed 114 metric tons, or 1.5 percent, to 7,614 tons, the exchange said today in a daily report. That's the highest level since July 13.

Nickel for delivery in three months fell $400, or 1.3 percent, to $29,650 a metric ton as of 11:17 a.m. London time and traded as low as $29,100 a ton. A close at the level would be the lowest since Oct. 5.

Nickel inventory jumped 14 percent since Nov. 3. It's still equal to less than three days of global consumption. Briggs forecasts a supply global shortfall of 40,000 tons this year.

Eramet SA, operator of the world's largest ferronickel plant, restored full access to its nickel mine in New Caledonia today, spokesman Philippe Joly said from Paris. Two of the company's four mines on the Pacific island have been blocked by striking miners since September, disrupting the supply to the Doniambo plant. Some miners remain on strike, Joly said.

The outlook for a swift end to the stoppage and a resumption of production "remains uncertain," Stephen Briggs, a London-based analyst at Societe Generale, said by phone.

Among other metals traded on the LME, copper gained $50, or 0.7 percent, to $7,170 a ton. Aluminium climbed $11 to $2,728 a ton and tin advanced $100, or 1 percent, to $9,900 a ton. Lead dropped $25 to $1,692 and zinc lost $45 to $4,375 a ton.