It is reported that poor nickel prices and financial market upheaval have prompted French metal producer Eramet SA to review investments across the business and it will likely delay some projects.

Mr Patrick Buffet CEO of Eramet SA said that, while prices have stabilized around USD 4.50 per pound for now, this still means Eramet's nickel production on the French controlled island of New Caledonia is losing money.

He said that demand from the global stainless steel sector is expected to be even lower during the fourth quarter compared with an already weak third quarter. He added that "Investments across the group are currently undergoing a strategic review in light of market conditions. In some cases, we will look to significantly cut the cost of certain projects, and for some, a delay will be inevitable."

A new power station for its Doniambo nickel smelter in New Caledonia may become the first project to face a delay, but Mr Buffet reiterated his long term interest to develop the Pony nickel deposit in the southern part of the island, registering for an exploration license in July 2008.

Given production cutbacks by stainless steel producers of up to 50%, Eramet SA risks not selling all of next year's nickel output if it goes ahead with current production plans. Eramet has already reduced output at its Doniambo smelter to 52,000 tonnes for 2008, down by around 13% YoY and down from a targeted 55,000 tonnes.