Mincor bullish as nickel price lifts

Mincor Resources says it expects to exceed its full-year nickel production guidance as the price of the base metal hit a 14-month high overnight.

The West Perth-based miner produced 2,203 tonnes of nickel-in-ore during the March quarter, down from 2,735 tonnes in the December 2013 quarter.

Production was hampered by flooding at the Mariners mine, with increased water inflows as a result of heavy rain in late January.

The flooding issues also pushed Mincor's costs for the quarter higher, with the miner recording cash costs of $5.65 per pound of nickel compared to $4.56/lb in the previous quarter.

Its sales revenue came in at $22.6 million, compared to $25.4 million in the previous quarter.

Despite this, Mincor says production was within its forecast expectations and places the company on track to beat the upper end of its forecast 8,500 to 9,000 tonnes of nickel-in-ore production for the 2014 financial year.

This is partially due to Mincor achieving unbudgeted production from its Otter Juan and McMahon mines during the quarter.

The mines had been due to close in November last year but Mincor achieved steady production from the mines during the March quarter before placing them on care and maintenance at the end of March.

The nickel price touched a 14-month high overnight on the London Metal Exchange at $18,332 per metric tonne, before closing at $18,325/mt.

Analysts said the base metal's price spike had been driven higher by concerns about supply outages as a result of the conflict between Russia and Ukraine. 

Mincor shares were trading 9 per cent higher at 97 cents at 1:05pm WST.