The ongoing ramp up of new stainless melting capacity in China warranted a substantial increase in our demand forecasts. However, this change was more than offset by a larger increase in forecast supply, chiefly due to new NPI production in Indonesia. Despite these changes, the nickel market will end 2016 in deficit and it is still expected to remain undersupplied through to 2020. Much of the shortfall can be met by stocks but by 2020 there will be a need for new project development. Critically, more sulphide mines will be needed in order to keep existing smelters in operation. In order to maintain a reasonable market balance, around 665kt of new finished nickel supply will be needed by 2035. We estimate that the promise of a long-term nickel price of US$22,000/t (US$10.00/lb, real) should be enough to incentivise those new projects.