Due to Russia's war on Ukraine, Nickel, a key component in high-tech devices has the markets in turmoil as Chinese nickel giant Tsingshan Holding Group Co is facing billions of dollars in losses posing a serious challenge to Chinese mining interest in South Africa.
This comes at a time when the Chinese company wagered that nickel prices would fall but instead the trading prices skyrocketed. The reason for the spike was Russia's invasion of Ukraine, reported VOA News.
The nickel giant's bet predicted that there will be a dip in the prices out of concerns about disruptions to the Russian company Nornickel, one of the world's largest suppliers however the prices soared leading to a loss of billions of dollars to the company.
At one point the price surged by 250 per cent, prompting the London Metal Exchange (LME) to suspend trading. The price fell back somewhat when the market reopened on Wednesday, but the exchange quickly suspended trading again, saying it was investigating a technical error, reported the news portal.
Like many other companies, Chinese mining companies have considerable interests in Africa -- specifically nickel-rich Zimbabwe and the market turmoil is just bad news for the company.
This comes at a time when the Wenzhou-based company, which recorded USD 19 billion in revenues last year, is building a massive USD 1 billion iron-ore mines and carbon steel plant in Zimbabwe with a capacity of 1.2 million tons, reported the news portal.
However, Christian Geraud Neema Byamungu, a policy and mining analyst and an editor at the China Africa project, said the losses incurred by Tsingshan "could delay its operations in Zimbabwe for a short period of time."
"This would be bad news for Zimbabwe, which has high expectations for this project," he added. "At this stage of the situation, we can only assume that it's a setback and not a real long-term problem since we haven't measured the real impact of its losses yet."
( With inputs from ANI )
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