Eramet SA, operator of the Doniambo ferronickel plant, the world’s largest, has spent EUR 900 million (USD 1.2 billion) over 10 years to boost output at the smelter in New Caledonia as demand rises.

Mr Patrick Buffet CEO said that production at Doniambo, which has been in operation for 100 years, will increase about 7% from this year to 60,000 tonnes in 2012. He said that “Capacity will rise to 65,000 tons in the “medium term.”

Mr Jim Lennon research director of Macquarie Securities said that the outlook for nickel, used to rust-proof steel, is strong because of growing stainless steel consumption, particularly in China, limited supplies and risks attached to new projects. He predicted a price range of USD 20,000 to USD 25,000 a tonne for the next 18 months.

(Sourced from Bloomberg)