Spot refined nickel continued to fluctuate, while nickel sulphate remained at a discount to refined nickel. [SMM Nickel Morning Meeting Summary]

3.28 Nickel Morning Meeting Summary

Refined Nickel: SMM March 27 news: Spot premiums/discounts: The mainstream spot premium quotation range for Jinchuan No.1 nickel was 1,800-1,900 yuan/mt, with an average premium of 1,850 yuan/mt, up 50 yuan/mt from the previous trading day. The premium/discount quotation range for Russian nickel was -100 to 100 yuan/mt, at parity, unchanged from the previous trading day. Futures: Nickel prices fluctuated rangebound after opening today. As of 11:30, the closing price was 129,900 yuan/mt, up 0.11% from the previous trading day's settlement price, with a low of 129,600 yuan/mt. Spot premiums/discounts: Jinchuan brand nickel rose 50 yuan from the previous trading day. Recently, nickel prices have been fluctuating, and traders have appropriately raised premiums to protect profits while observing the recovery of market demand. Macro perspective: SHFE nickel futures contracts fluctuated slightly lower after opening in the morning, but nickel prices were supported by Indonesia's slower-than-expected mining progress and volume. Follow-up attention will be paid to the progress of tax policy releases. Nickel sulphate price spread: Today, SMM1# refined nickel prices were 129,700-132,000 yuan/mt, with an average price of 130,850 yuan/mt, down 25 yuan/mt from the previous trading day's spot price. The price spread was around 2,531 yuan/mt (Ni contained), with nickel sulphate still at a discount to refined nickel.

Nickel Sulphate: On March 27, the SMM battery-grade nickel sulphate index price was 28,023 yuan/mt, with a quotation range of 27,970-28,550 yuan/mt, and the average price remained stable compared to the previous day. Cost side: MHP market circulation remains tight, with most traders' inventories nearing depletion. Recently, MHP transaction coefficients have shown an upward trend, with no downward momentum in the short term. Auxiliary materials: The rise in sulphuric acid prices has pushed up MHP costs. Supply side: Affected by rising MHP prices, some nickel salt smelters have limited acceptance and have not completed MHP stockpiling for Q2, with expectations of production cuts. Nickel salt smelter inventories remain at low levels, and the market circulation of nickel salts is significantly tight, leading to strong sentiment among smelters to stand firm on quotes. Demand side: This week, as a traditional procurement period, precursor plants will concentrate on stockpiling, and their acceptance of nickel sulphate prices has improved. Currently, buyers and sellers are still in a price game, and nickel sulphate prices are expected to have upside room in the short term.

Nickel Pig Iron (NPI): On March 27, the SMM 8-12% high-grade NPI average price was 1,025.5 yuan/mtu (ex-factory, tax included), up 0.5 yuan/mtu from the previous working day. Supply side: Domestically, smelter raw material inventories are running low, and shipments from the Philippines at the end of the rainy season will take time to arrive. Some smelters are undergoing maintenance, and production is running at low levels. In Indonesia, nickel ore mining and volume have fallen short of expectations, and some smelters' raw material inventories are at low levels. Despite the release of new capacity, production growth is limited. Demand side: Stainless steel spot performance is weak, and the price of stainless steel scrap has decreased, restoring economic advantages, putting pressure on high-grade NPI prices. However, from the perspective of cost and market circulation resources, high-grade NPI is expected to remain stable in the short term.

Stainless Steel: SMM survey shows that on March 27, some stainless steel market prices were stable to slightly higher. Market activity was average, and transactions were flat. The most-traded futures contract 2505 fluctuated rangebound. At 10:30, SS2505 was quoted at 13,385 yuan/mt, up 25 yuan/mt; the price fluctuated rangebound at 13,390-13,440 yuan/mt throughout the day. In Wuxi, the 304/2B spot premium/discount was in the range of 2,185-435 yuan/mt. In today's stainless steel spot market, the price of cold-rolled 201/2B coil in Wuxi was 8,000 yuan/mt, and in Foshan, it was 8,025 yuan/mt. The average price of cold-rolled cut edge 304/2B coil in Wuxi was 14,025 yuan/mt, and in Foshan, it was 13,950 yuan/mt. The price of cold-rolled 316L/2B coil in Wuxi was 24,145 yuan/mt, and in Foshan, it was 24,475 yuan/mt. The price of hot-rolled 316L/NO.1 coil in Wuxi was 23,200 yuan/mt, and in Foshan, it was 23,450 yuan/mt. The price of cold-rolled 430/2B coil in Wuxi was 7,500 yuan/mt, and in Foshan, it was 7,475 yuan/mt. In the future, stainless steel market prices are expected to maintain a rangebound fluctuation trend.

Nickel Ore: Last week, low-grade and high-grade nickel ore prices in the Philippines remained stable, while medium and high-grade Philippine ore prices rose slightly again, mainly due to two reasons: 1. As an exporter, Indonesia's nickel ore prices have risen and are expected to continue to rise, providing some support for Philippine nickel ore export prices. 2. From a supply and demand perspective, the Surigao region began to offer and ship this month, but supply recovery has been slow due to weather. On the demand side, most domestic nickel pig iron plants' inventories are still at low levels, and there is a strong demand for just-in-time procurement of raw materials. However, although the current rise in downstream high-grade NPI prices has brought some profit recovery, domestic iron plants are still in a cost inversion, and their ability to accept high-priced nickel ore is limited. Ocean freight rates rose again during the week due to the shift in shipment locations and bad weather, further increasing nickel ore import costs. Overall, under the influence of a strong supply and weak demand pattern and policy-side disturbances, Philippine prices have risen. SMM expects that Philippine ore prices may remain stable with a strong trend in the future. Last week's market transaction prices: For pyrometallurgical ore, SMM Indonesia's local ore 1.6% weekly price was $49.5/wmt; for hydrometallurgical ore, SMM Indonesia's local ore 1.2% grade weekly price was $26.5/wmt. The premium for pyrometallurgical Indonesian nickel ore in March remained stable at $19-21/wmt. The slight increase in CIF prices mainly came from the Indonesian Ministry of Energy and Mineral Resources' release of the benchmark price for the second half of March on the 15th, which showed a slight increase compared to the previous period, with 1.2% grade ore up $0.26 and 1.6% grade ore up $0.46. From a supply perspective, this year's prolonged rainy season in Sulawesi has had a certain impact on nickel ore mining and transportation, and supply recovery in main mining areas such as Sulawesi has been slow. In addition, the end of March coincides with the Eid al-Fitr holiday, which has exacerbated the tight supply situation to some extent. From a demand perspective, Indonesian nickel pig iron smelters generally have low inventories, and there is still a strong demand for just-in-time restocking, with downstream procurement sentiment high. SMM expects that nickel ore supply may continue to be tight. Policy: Last week, the Indonesian Ministry of Energy and Mineral Resources signaled that the PNBP policy may be implemented before Eid al-Fitr. If the policy is implemented as scheduled, the sales cost of nickel ore mines will increase, and combined with the current continuous rise in downstream NPI and MHP prices, from the current market situation, mines have strong bargaining power, and the cost increase brought by this policy to mines may be largely passed on to downstream enterprises, providing strong support for nickel ore prices. Overall, SMM expects that Indonesian local nickel ore prices may continue to rise.