[ferro-alloys.com]Western Areas managing director Dan Lougher says stainless steel demand is still the driving force behind rising nickel prices, despite expectations the commodity will play a big role in supplying the growing battery and electric vehicle market.

Western Areas yesterday announced it had commissioned an expansion to its Cosmic Boy Mill at the 22,000tpa Forrestania nickel operations south of Southern Cross, which will boost recoveries and produce a high-grade concentrate, which can be marketed to battery producers.

Mooted in 2015 before low nickel prices forced Western Areas to put the $24 million project on ice, it was revived last year in more optimistic market conditions.

Mr Lougher insisted strong demand for stainless steel and declining stockpiles of the base metal were behind its 2018 price run, with the battery market emerging as a sweetener for demand.

“It has not been a physical driver, because the main thing that we’ve seen is that if you look at the volume of nickel going into lithium ion batteries today probably it’s growing, but it’s not huge,” he said.

“That is probably adding a bit of spice into the mix, but we’re quietly happy that the stainless market is still the driving force.

“Remember, stainless steel is still 70 per cent of the world of nickel.

“Nickel used in all battery styles would be probably 5 to 6 per cent, but it is growing and I guess the view of the market is the EV market might be accelerating faster than most commentary is saying.”

High-grade product from the mill recovery enhancement project will be blended with existing Forrestania concentrate in its initial stages, before a separate filtration and bagging facility is established in the September quarter.

Western Areas is also investigating using the MREP and its patented heap leaching process to tap a third mine at Forrestania, the New Morning open pit, where the company is progressing environmental and mining studies.

• [Editor:王可]