In this week's metal market, the price of high-nickel pig iron (NPI) continued to show a weakening trend. According to data from SMM (Shanghai Metals Market), the average ex-factory price of 8-12% high-nickel pig iron this week was CNY 940.1 per nickel point (including tax), down by CNY 3.3 from the previous week's average price. Additionally, Indonesia's NPI FOB price index dropped by USD 0.6 per nickel point compared to the previous week. This trend reflects the market's response to the supply and demand dynamics of high-nickel pig iron.
On the supply side, the domestic market indicates that due to the continued decline in finished product prices, smelting plants are facing increased pressure from losses, with production remaining stable and no significant reduction in output observed. In Indonesia, since smelters have relatively ample raw material inventories and are maintaining a certain profit margin, the overall output has seen a slight increase. This means that even though market prices are under pressure, there is still elasticity on the supply side.
On the demand side, the spot price of stainless steel has shown signs of stabilizing during this period, with order intake by steel mills picking up, and short-term speculative demand increasing. As a result, there remains a demand for raw material procurement from steel mills. However, there have been notable changes in procurement strategies, with long-term contracts accounting for a larger share and single-batch purchases mostly made at average prices. It is expected that in the short term, the demand for high-nickel pig iron is likely to recover, and under cost support, its price will show relatively stable movement.
It is worth noting that the average discount for high-nickel pig iron relative to electrolytic nickel has reached CNY 310.2 per nickel point, expanding by CNY 11.8 per nickel point from last week. Despite the continued low price of high-nickel pig iron, buyers still hold an advantage in the market. Especially as stainless steel prices stabilize and sales improve, the market's price suppression sentiment has eased, leading to a further slowdown in the rate of price decline this week.
Regarding the pure nickel market, due to the holiday impact on the international market this week, short positions gradually exited, resulting in a rebound correction in nickel prices. From a fundamental perspective, newly added electric nickel projects overseas are still in a ramp-up phase, while downstream demand has not shown significant growth, causing the nickel market to remain in an expanded supply surplus phase. On the cost side, the current cost line remains stable, forming strong support for pure nickel prices. In the short term, although the fundamentals for pure nickel prices are relatively weak and there is potential for a downward trend, the strong cost support is expected to limit the extent of any price decline.
Considering the market trends for next week, it is anticipated that the average discount for high-nickel pig iron relative to electrolytic nickel may experience fluctuating narrowing. Under the influence of various factors, the price of high-nickel pig iron is expected to stabilize, while pure nickel prices may have a slight downward space due to fundamental pressures.
![[Análisis de SMM] La demanda de compras externas downstream es débil; los precios de las sales de níquel cayeron esta semana](https://imgqn.smm.cn/usercenter/KFwsY20251217171734.jpg)
