Ten kilometres wide and travelling at 75km per second, the meteorite collided into an area of northern Ontario, turning the Earth’s crust inside out. It left a kidney-shaped scar 250km wide and 35km deep, rich in nickel and copper, as well as cobalt, platinum and palladium.

The nickel price gained 2 per cent yesterday, as the market assessed the impact of even bigger concentrations of power in a small area. In mining terms, a Phelps Dodge incorporating Falconbridge and Inco will be a cupro-nickel titan and, even if it cannot defy market forces, it can play a role in smoothing out the bumps and dips of volatility. Large Western mining groups, such as Phelps, BHP and Rio, have played a role in cutting output during demand slumps and quickly raising output when the price beckons.

Inco and Falconbridge have been mining the nickel-bearing sulphides in Sudbury since the beginning of the last century, but nickel, along with copper, has become more interesting to investors because of rising demand for stainless steel.

Nickel is useful because it combines easily with other metals, such as iron and copper, to form alloys that are stronger and more resistant to corrosion. Most of the nickel used in the world goes into alloys, mainly stainless steel, but also super-alloys, such as those used in jet engines. It is also used in rechargeable batteries and as a catalyst to speed up chemical reactions in oil refineries.

For years a dull commodity, nickel is suddenly interesting because it is needed in big building and infrastructure projects, notably in China, where stocks of stainless steel have declined by 30 per cent over the past year, despite rising production.

“It’s a market very much like copper. There is rising demand but limited new supply,” says Robin Bhar, an analyst at UBS.

Russia and Canada are the biggest producers of nickel from the Sudbury mines and the giant Norilsk deposit in Siberia. However, new sources are being developed from laterites, clay deposits that require more expensive technology to extract the metal from the ore.

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