Recovery in nickel prices, weather to boost GFNI

LISTED Global Ferronickel Holdings, Inc. (GFNI) is banking on improved nickel prices and favorable weather conditions for 2017 to reach its production target and to see improved profit.

GFNI President Dante R. Bravo said the company is looking at achieving a “much better” net income by year end compared to the P37.5 million in 2016 — a drop from P1.11 billion in 2015 — as the firm registered low production and record- low nickel prices pulled down the performance of nickel miners last year.

GFNI is targeting to deliver 6 million wet metric tons ( WMT) this year and Mr. Bravo sees the target as achievable so long as the weather for the rest of the year remains favorable.

To date, the company has shipped out 1.7 million WMT.

Average realized price of nickel so far has jumped 32% year on year to $18.4 per ton, Mr. Bravo added.

“Looking into the medium term, the consensus view is that nickel demand will increase by 3% annually from 2017-2020 on the back of stainless steel,” Mr. Bravo said during the firm’s annual stockholders meeting held in Makati City on Wednesday.

“The sentiment is more positive this year. It’s more positive compared to last year because there’s urbanization going on basically in Asia- Pacific region which will drive nickel demand in the region. Then there’s technological breakthrough which is the emergence of energy vehicle systems requiring batteries,” he added.

For the January to March period, the firm clocked in reduced losses at P116.68 million from the P142.931-million loss it booked in the same quarter last year.

For this year, GFNI has allocated roughly the same amount of capital expenditure as in 2016 at $ 5 million, which will be allocated for exploration activities, facilities, equipment and road development. —