LONDON--Nickel futures soared to their highest levels in over two years Thursday after reports of a supply stoppage at a processing plant and mine added to traders' concerns over supply.

The LME's flagship three-month nickel contract rose 6.1% to $19,786 a metric ton in early trade -- its highest price since March 2012.

Vale SA (VALE) suspended production at its Goro nickel processing plant and mine in New Caledonia due to an effluent spill, according to reports Thursday. The mining giant, which is the world's No. 2 nickel producer, is reportedly waiting to hear from the local government about when it can resume operations at the plant.

While the Vale stoppage alone won't move the needle much in terms of supply -- Goro's annual capacity of 60,000 tons barely eats into Bank of America Merrill Lynch projections for 2014 global production of 2.035 million tons -- the news added to already-heightened concerns over supply of the metal amid an ore export ban in top nickel producer, Indonesia.

"We are in a bull mode, so any outage is exaggerating the move" higher said Rob Montefusco, a senior commodities broker at Sucden Financial. "It's a tough call but $20,000 a ton looks quite achievable."

Most other base metals were higher on the day Thursday, boosted by some upbeat trade data from top metals consumer, China. Copper was up 0.1% at $6,663.75 a ton, zinc was up 0.3% at $2,035.75 a ton, lead was up 0.2% at $2,084 a ton and tin was 0.4% higher at $23,190 a ton. Only aluminum was down, by 0.3% at $1,764.50 a ton.

Write to Francesca Freeman at francesca.freeman@wsj.com

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