[SMM Analysis] Weak Demand Keeps Nickel Intermediate Product Payables in the Doldrums

Published: Jul 24, 2026 17:46

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This week, the MHP market supply-demand pattern remained loose, and nickel and cobalt payables stayed weak. On the supply side, after the strait was reopened, some producers' MHP output recovered, while some traders also released inventories to a certain extent recently, boosting market availability. On the demand side, downstream nickel salt and cobalt salt prices remained sluggish, cobalt sulphate production faced heavy losses, and salt plants were relatively reluctant to accept high-priced MHP, putting pressure on MHP payables. Given the pattern of rising supply and weak demand, MHP payables may pull back in the short term.

The high-grade nickel matte market was similarly in a pattern of both weak supply and demand. Currently, high-grade nickel matte held a clear economic advantage over MHP, but on the supply side, mainstream suppliers had completed long-term order signings, leaving limited available spot cargo; on the demand side, consumption was constrained by downstream production line compatibility, resulting in insufficient actual absorption capacity. Overall, purchase sentiment was weak, trading activity was low, and payables remained stable.

The international sulphur market saw its geopolitical risk premium swing back and forth. In mid-June, the US-Iran truce briefly restored navigation, but on July 7 the ceasefire broke down, the Strait of Hormuz was blocked again, and Middle Eastern supplies continued to tighten. Compounding this, Kazakhstan’s indefinite ban on exports to countries other than Russia, Russia’s ban extended to the end of 2026, and Turkey’s ban lasting until the end of Q3 intensified short-term supply disruptions again, keeping sulphur prices swinging wildly at highs.

In terms of nickel prices, nickel extended a technical rebound this week, but due to lower MHP payables, MHP nickel prices pulled back somewhat, while high-grade nickel matte prices improved slightly alongside the nickel rebound amid stable payables. Moreover, MHP cobalt prices also pulled back on the decline in cobalt payables. Overall, the intermediate product market will remain under pressure in the near term.

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

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