Avebury Nickel Mine the latest to close amid nickel price decline

The Avebury nickel mine in Tasmania is the latest Australian nickel mine to suspend operations following a decline in nickel prices amid increased international competition and reduced demand. 

Mallee Resources Limited, owner of the Avebury mine, announced that the mine had gone into receivership in September last year.  

KordaMentha, the receivers and managers of the mine, have confirmed that the Avebury nickel mine will be transitioning into care and maintenance due to a near 50% decline in global nickel prices since last year. 

Tasmanian Resources Minister Felix Ellis says Tasmania has not been immune to the global nickel implosion which is mothballing mines across Australia and internationally, with other nickel mines like Cosmos, Cassini, Long, Durkin, Savannah and Andrew Forrest’s Kambalda mines also entering care and maintenance.

“Tasmania is already engaged with the Commonwealth and Western Australia as we work through a national production tax credit proposal for nickel – an important battery metal,” Mr Ellis said.  

He says Tasmania continues to urge the Federal Government to include nickel on the critical mineral list. 

The LME nickel price is hovering at around US$16,000/t, coming down almost 50% from the US$30,000/t it was trading at early 2023, with the price drop attributed to the significant expansion in Indonesian supply and reduced demand from China. 

Panoramic Resources (ASX: PAN) recently announced its decision to suspend the Savannah nickel project, with the majority of staff on-site made redundant.? 

Quantum Minerals’ (FQM) made a decision to scale back operations at its Ravensthorpe nickel mine, while also suspending mining at Shoemaker-Levy.? 

The company says stockpiles are sufficient for 18 months of production, after which time Hale Bopp and Halley’s ore bodies will be mined.?? 

This change in strategy aims to preserve the higher-grade Shoemaker Levy orebody until nickel prices recover and operating margins improve.? 

Andrew Forrest’s Wyloo Metals will also place its WA mines – Cassini, Long and Durkin – bought mid-last year for $760m, in care and maintenance on 31 May.? 

Wyloo is the major source of ore for BHP’s (ASX: BHP) nickel processing plant at Kambalda, WA, which will be shutting down in June as a result, impacting about 20 jobs.? 

In December last year, IGO (ASX: IGO) announced it was conducting a review of its Cosmos nickel project near Leinster, WA, where it was developing the Odysseus underground nickel mine.?