Trade tensions between China and Europe have flared once more, this time over who holds the keys to vital nickel supplies. What began as a routine business sale has become a new flashpoint in the wider struggle for control of key materials.
The European Commission has formally objected to MMG Ltd’s (HKG: 1208) planned purchase of Anglo American plc‘s (OTCMKTS: NGLOY) (LON: AAL) nickel assets in Brazil. In a statement of objections issued on Sept. 16, the Commission warned that the deal could harm competition in low-carbon ferronickel, a material essential for making stainless steel. Officials fear MMG might redirect supplies away from European buyers towards linked Chinese steel firms, pushing up costs and weakening Europe’s industry. MMG is majority-owned by China Minmetals Corporation, itself controlled by a Chinese government body. The assets include two working sites that currently serve European markets (Barro Alto and Codemin) and two undeveloped projects.
This step does not end the deal, but MMG must now reply to the concerns, review the evidence and may request a hearing. As the EU’s competition authority, the Commission holds the power to block the sale outright, clear it or demand changes if it decides the risks remain too high. It has until the end of November to reach a final decision.
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Nickel’s importance
Nickel from the Brazilian operations mainly helps produce stainless steel, which resists rust and forms everyday items from kitchen tools to industrial equipment. Europe relies on steady supplies of this type to keep its steel plants competitive. If the metal shifts elsewhere, European makers could face higher prices and weaker resilience.
Beyond steel, nickel strengthens special alloys used in aircraft engines that endure extreme heat. It also appears in batteries for electric vehicles, protective coatings and some medical tools. These wider uses matter less in the current dispute but still show how deeply the metal supports modern industries.
A backdrop of trade tension
This dispute forms part of deeper strains between the EU and China. In her State of the Union address to the European Parliament on Wednesday, Commission President Ursula von der Leyen said the trade deficit with China had reached a tipping point, with Europe losing factories as Chinese goods flood in. She stressed the need to secure rare earths, which China largely controls, and the bloc is pressing Beijing to limit hybrid car exports that threaten European makers.
Trade talks continue, with an EU commissioner due in Beijing in early October for key meetings. Leaders on both sides will test whether practical steps can ease the imbalance. The nickel case adds weight to those discussions, showing how resource control now sits at the heart of Europe’s push for more balanced trade.
“We need to urgently procure and build up our reserves,” von der Leyen stated, explaining that rare earths and critical minerals were of the utmost concern.
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