Media Release
Tuesday 26 August 2003 - AO40/2003
Australian Company Signs Billion Dollar Nickel Deal With China
The signing today of an A$1 billion nickel supply agreement between Australian company WMC Resources Ltd and China’s largest nickel producer, Jinchuan Group, is confirmation of the strength of the relationship between the two countries, Trade Minister Mark Vaile said today.
“China is now Australia’s fastest growing major export market and third largest trading partner. Trade between Australia and China has doubled under this Government,” Mr Vaile said.
“As a result of this deal nickel will be one of our largest exports to China in the years ahead just as Liquified Natural Gas (LNG) will become one of our largest exports off the back of the $25 billion contract signed last year.
“Nickel consumption is growing faster in China than anywhere else in the world and is a major input to stainless steel. Extensive construction in China is likely to drive enormous demand for the metal in coming decades,” he said.
The agreement signed today is for the supply of 90,000 tonnes of nickel-in-matte* and adds to a 30,000 tonne agreement signed with Jinchuan in December last year. WMC began their relationship with Jinchuan in 1988, assisting in the construction of their nickel smelter.
WMC will export 120,000 tonnes of nickel-in-matte to Jinchuan between 2005 – 2010 from its Kalgoorlie Nickel Smelter in Western Australia. When refined, this nickel-in-matte will represent more than 20 per cent of the total domestic production of nickel metal in China to 2010.
Jinchuan Group Limited is China’s largest integrated producer of nickel for the domestic market. Jinchuan’s nickel output accounts for over 88 per cent of Chinese production, producing 60,000 tons of nickel annually.
“Although the Jinchuan Group produces large amounts of nickel, they’re unable to meet domestic demand, opening up opportunities for international suppliers of nickel, such as Australia’s WMC, and their workers,” Mr Vaile said.
* Nickel-in-matte is a value-added product, following concentration and smelting of nickel ore. It contains approximately 68 per cent nickel.
Contact: Matthew Doman (Mr Vaile’s office) 02 6277 7420