(different source used than daily updates) The week began when markets opened Monday at $22.91/lb, reached a high of $23.00/lb, a low of $22.61/lb, and ending at $22.88/lb. Tuesday, markets would open at $22.97/lb, climb to $23.13/lb (the high for the week and shy of the $23.50/lb record), then tumble to the low of $21.82/lb, where it would end the day. Wednesday, markets opened at $22.32/lb, which was as high as it would get, fall to a low of $20.76/lb, and end at $20.93/lb. Thursday, would prove the low point of the weeks trading, with markets opening at $21.00/lb, seeing a high of $21.46/lb, a weekly low of $20.42/lb, and ending the day at $20.59/lb. Friday would open at $20.59/lb, climb to $21.39 after seeing a low of $20.50/lb, and ending the day and week at $21.20/lb. Based on ending prices, the price of nickel fell approximately 8% from last Friday, but still remains 40.4% higher than it started the year at. One year ago today, nickel was $10.43/lb, two years ago, $7.47/lb, and four years ago tomorrow, nickel would breech the $4.00/lb mark.

The CRU Stainless Steel index shows during this same period the cost value of stainless has gone from 97.38 in May 2003, to 136.58 in May of last year, to 238.91 this month. For those who like to draw parallels, the price of crude oil contributes 42.6% to the retail price of gasoline, while nickel is normally responsible for around 2/3 the cost of 300 series stainless steel (proportionately higher now). In 2003, a barrel of oil averaged $32.51 and the price of gas in the US reached a seasonal high of $1.73/gallon. A barrel of oil Friday would cost you $65.54 (down from $79 barrel last summer) and the average price of gasoline in the US is $3.23/gallon (peaked at $3.11 gallon last year). While there are parallels between the two, there are numerous differences, the biggest being the direct effect politics plays on the price of petroleum. And while politics has an impact in any international trade, nickel included, if our memory is correct, World War Two was the last time the world saw major battles fought over nickel mines.

Then again, there is Cuba. Yes, we speak of that tiny, half occupied, nearly bankrupt island, just miles from our own coast, and its vast resources of nickel. Nickel, we might add, that is forbidden by U.S. law, to find its way into any product purchased in the United States. And if you think we are kidding.... we aren't. No matter what - we have to keep our principles! :-)

   Two reports - Fortis Metal Monthly - pdf here  and the Fortis Asian Metals Monthly - pdf here

  NMA Mining Week - pdf here

  Vale Says Voisey's Bay Nickel Refinery Resumes Production - "Cia. Vale do Rio Doce, the world's second-largest nickel producer, said nickel production at its Voisey's Bay project in eastern Canada resumed last night after safety concerns shut a refinery." - article here   RCMP probe labour spat at Voisey's Bay mine - "The RCMP are investigating an incident of labour friction at the strike-bound Voisey's Bay nickel mine in Labrador, amid an ongoing walkout and an NDP call to outlaw replacement workers." - article here

  Stock analysis by Galaxy Securities for Taigang Stainless Steel - (translated online, but you'll get the point) "Although nickel price increases contributed to nickel stainless steel prices continuing to rise, the escalation of consumption among domestic high-end clients including petrochemical, automotive, liquor and other industries, can still digest nickel stainless steel price increases. Meanwhile nickel stainless steel price increases driven non-nickel stainless steel market sales brisk." In another article on the company and posted on China Finance Net -  Taigang estimates the ratio of 400 series to other types of stainless they will sell will climb from "31% in 2006, to 40% this year". And more interesting forecasts for the stainless steel industry as a whole in China - translated article here

  Arroyo brings 1 million US dollars in investments from Tokyo - "President Gloria Macapagal-Arroyo arrived Friday afternoon from her four-day visit to Japan bringing home with her more than US$1 billion worth of investments, mostly in mining." - article here

  Behind The Big Nickel Bidding War - "No wonder Norilsk Nickel and Xstrata are fighting over LionOre Mining International; according to the international investment bank, Credit Suisse, world nickel prices could continue to rally and even reach $US65,000 a tonne this year." - article here  (we would be surprised if the little blurb we posted Friday doesn't get some more attention in the coming weeks - "Kommersant - Norilsk shareholder and former CEO Mikhail Prokhorov, the only board member to vote against upping the bid for LionOre, thinks a deal on such terms is too risky for the Russian mining giant". Takeovers are a generally a positive sign for long term commodity prices, but when a company executive of this caliber disapproves of a takeover, it could be seen as bearish.)

  Comment - Possible problem on the horizon for Xstrata in New Caledonia? On May 6, Radio New Zealand mentioned a study that had  just been published by the University of New Caledonia, which found cases of mesotheliomas were 30 times higher in New Caledonia than in France, and particularly, extremely high among tribal members in the northern part of that country. There are numerous reports posted online that show the mining of nickel  itself, does not increase cases of mesotheliomas, a cancer brought about by inhaling asbestos fibres. It does appear, however, that northern New Caledonia contains many deposits of asbestos rock. When this rock is cleared, the air is filled with asbestos fibers, which have been found to be harmful to humans. Will the construction of the Koniambo mine, with its infrastructure requirements, cause these deposits to be disturbed? We don't know, but if they are, you can bet we will hear more about it.  

  LionOre shortsighted on Xstrata break fee - "Suppose the bright lights at Inco had done things differently. Suppose, when they tried to buy Falconbridge a couple of years ago, they'd used an iron fist instead of velvet gloves." - article here

  China's share-buying binge could get ugly -  (quote) "The stock market bubble has now pulled in so many of the emerging middle class - the number of trading accounts has risen to nearly 100 million - that a crash will be a political problem." - more here

  PBS reports - Frontline - 63 episodes now online here / Nova episodes online here / Watch Al Jeezera English, and other news and tv channels online for free here

With 2/3 of nickel going to stainless steel producers, those who mine nickel, pay close attention to the reaction of this important customer base. While investors demand the highest return possible on their investment, the mining company, who will be