Nickel vulnerable to weak China imports, slow demand

A month-long rally in nickel prices risks running out of steam as import demand from top consumer China eases due to a well supplied market and a lack of appetite in Europe saps demand for stainless steel. Benchmark nickel on the London Metal Exchange (LME) have risen more than 17% since the beginning of the year, partly due to strong buying from China at the end of 2011 and short covering by funds.

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