Between 1966 and 1976, Australia moved from being a non-producer to a
position of meeting more than ten per cent of world nickel demand. New
mine developments beginning the early-1990s have the promise of more
than doubling the country's world market share - from around eight per
cent to perhaps close to 20 per cent. This new surge in activity - the
so-called `second nickel boom' - has led to several developments which
seem likely to have similar economic impacts to those of the late- 1960s
and early-1970s. There are, however, some notable differences this time around. The
impact of long distance commuting over the past 30 years has changed the
regional development scenario. The gold industry is much stronger in
Australia than it was in the late-1960s and this helps to place the
importance of new nickel discoveries in a more realistic perspective. As potential players have jockeyed to complete feasibility studies and
move into construction and production phases of new long-life mines,
established suppliers clearly seem to be taking actions to discourage the
newcomers. In what appears to be a classic oligipolistic market situation,
the heightening of perceived entry barriers to the industry appears to be a
particularly visible strategy undertaken. In the current scenario as well,
greater vertical integration among producers appears a significant
influence on market power.