Some nickel stocks are still thriving in the ongoing tough nickel market. After trending down through 2023, nickel prices climbed to a 10-month high in late May, but they’ve since pulled back.
Supply is expected to outflank demand over the short term, but the longer-term outlook for the metal is strong. Demand from the electric vehicle industry is one reason nickel’s future looks bright further into the future.
“Global nickel consumption is expected to increase due to recovery of the stainless steel sector and increased usage of nickel in electric vehicle batteries. Batteries now account for almost 17 percent of total nickel demand, behind stainless steel,’ Ewa Manthey, commodities strategist at financial services firm ING said in the lead-up to 2024.
“The metal’s appeal to investors as a key green metal will support higher prices in the longer term.’
As for Canada’s nickel market, the critical metal is listed as one of the top priorities in the Canadian government’s Critical Minerals Strategy, which was announced in 2023. The country is the world’s fifth largest producer, with much of the production coming from mines in Ontario’s Sudbury Basin, including Vale’s (NYSE:VALE) Sudbury operation and Glencore’s (LSE:GLEN,OTC Pink:GLCNF) Sudbury Integrated Nickel Operations.
Additionally, in February, Canada Nickel Company (TSXV:CNC,OTCQX:CNIKF) announced its wholly owned subsidiary NetZero Metals is planning to develop a US$1 billion nickel processing plant in Ontario that would become North America’s largest once complete.
All year-to-date and share price data was obtained on July 30, 2024, using TradingView’s stock screener. The top nickel stocks listed had market caps above C$10 million at that time.
1. Class 1 Nickel and Technologies (CSE:NICO)
Year-to-date gain: 233.33 percent; market cap: C$32.66 million; share price: C$0.20
Class 1 Nickel and Technologies flagship property is its wholly owned Alexo-Dundonald nickel project near Timmins, Ontario. The past-producing project hosts four nickel sulfide deposits. The company’s pipeline also includes the past-producing Somanike nickel-copper project near Val-d’Or, Quebéc, and the River Valley platinum group elements (PGE) project near Sudbury, Ontario.
Class 1 Nickel released mineral resource updates for the Alexo South and Alexo North deposits in April and May of this year, respectively. This was followed by updated technical reports on each deposit in June and July. The company expects to start work on a preliminary economic assessment in the near-term as part of its plan to bring the project back into production.
The Canadian nickel exploration company’s share price started off the year at C$0.06, and it began climbing in April to reach a year-to-date high of C$0.21 on July 26.
2. Power Nickel (TSXV:PNPN)
Year-to-date gain: 158.33 percent; market cap: C$119.22 million; share price: C$0.62
Power Nickel is focused on developing its 80 percent owned Nisk polymetallic property in Quebéc, which hosts nickel, copper, platinum and palladium mineralization. According to the company, it plans to create Canada’s first carbon neutral nickel mine. The polymetallic nature of the project is a plus for the economic case for future nickel production in a low price environment.
This ongoing work has generated a succession of positive news flow for the company so far in 2024. After starting 2024 at C$0.24, shares in Power Nickel began gaining forward momentum in mid-April following two key announcements. First was the drill results on the newly discovered Lion copper, platinum, palladium zone 5 kilometers northeast of its main Nisk Deposit. Shortly after, the company announced the completion of its option to earn an 80 percent stake in the property from Critical Elements Lithium (TSXV:CRE).
Power Nickel’s share price jumped more than 15 percent on May 10 to reach C$0.64 following news that drilling continued to expand the high-grade, near-surface Lion discovery with notable assays that included 14.42 meters of 0.59 grams per metric ton (g/t) gold, 69.14 g/t silver, 8.17 percent copper, 6.25 g/t palladium, 8.44 g/t platinum and 0.58 percent nickel.
In June, Power Nickel commenced an 8,000-meter summer drill program at Nisk. This was followed by the closing of a flow-through offering with gross proceeds of over C$20 million, with some of the biggest names in mining — Robert Friedland and Rob McEwen — participating. The company’s stock value continued to climb before peaking at a year-to-date high of C$0.88 on June 21.
3. EV Nickel (TSXV:EVNI)
Year-to-date gain: 83.33 percent; market cap: C$48.01 million; share price: C$0.55
EV Nickel’s primary project is the 30,000 hectare Shaw Dome asset near Timmins, Ontario. It includes the high-grade W4 deposit, which has a resource of 2 million metric tons at 0.98 percent nickel for 43.3 million pounds of Class 1 nickel across the measured, indicated and inferred categories. Shaw Dome also holds the large-scale CarLang A zone, which has a resource of 1 billion metric tons at 0.24 percent nickel for 5.3 billion pounds of Class 1 nickel across the indicated and inferred categories.
EV Nickel is also working on integrating carbon capture and storage technology for large-scale clean nickel production, and has procured funding from the Canadian government and Ontario’s provincial government. In late 2023, the company announced it was moving its carbon capture research and development to the pilot plant stage.
The company’s news so far in 2024 includes the closure of a flow-through financing in March which ultimately saw EV Nickel raise C$5.12 million to fund the development of its high-grade large-scale nickel resources.
In April, EV Nickel launched its 2024 exploration program, which is aimed at advancing the CarLang trend and exploring other nickel targets. The most recent news out of the program came in mid-June with the announcement that diamond drilling on the Langmuir 2 high-priority nickel target had commenced and plans were in place to begin drilling on high-grade nickel targets contained within the Shaw Dome project starting in mid-June.
The Canadian nickel exploration company’s share price started off the year at C$0.30 before steadily climbing to reach a year-to-date high of C$0.79 on May 17.
FAQs for nickel investing
How to invest in nickel?
There are a variety of ways to invest in nickel, but stocks and exchange-traded products are the most common. Nickel-focused companies can be found globally on various exchanges, and through the use of a broker or a service such as an app, investors can purchase companies and products that match their investing outlook.
Before buying a nickel stock, potential investors should take time to research the companies they’re considering; they should also decide how many shares will be purchased, and what price they are willing to pay. With many options on the market, it’s critical to complete due diligence before making any investment decisions.
Nickel stocks like those mentioned above could be a good option for investors interested in the space. Experienced investors can also look at nickel futures.
What is nickel used for?
Nickel has a variety of applications. Its main use is an alloy material for products such as stainless steel, and it is also used for plating metals to reduce corrosion. It is used in coins as well, such as the 5 cent nickel in the US and Canada; the US nickel is made up of 25 percent nickel and 75 percent copper, while Canada’s nickel has nickel plating that makes up 2 percent of its composition.
Nickel’s up-and-coming use is in electric vehicles as a component of certain lithium-ion battery compositions, and it has gotten extra attention because of that purpose.
Where is nickel mined?
The world’s top nickel-producing countries are primarily in Asia: Indonesia, the Philippines and New Caledonia make up the top three. Rounding out the top five are Russia and Canada. Indonesia’s production stands far ahead of the rest of the pack, with 2023 output of 1.8 million metric tons compared to the Philippines’ 400,000 MT and New Caledonia’s 230,000 MT.
Significant nickel miners include Norilsk Nickel (OTC Pink:NILSY,MCX:GMKN), Nickel Asia, BHP Group (NYSE:BHP,ASX:BHP,LSE:BHP) and Glencore (LSE:GLEN,OTC Pink:GLCNF).
Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.