China refined nickel imports rose in October, but most of them were stored in bonded zones, imports to decline in November

Customs data showed that China’s refined nickel imports were 6670 mt in October 2023, of which customs clearance volume was 3370 mt (+39.8% MoM and down 84.39% YoY). The top three pure nickel suppliers of China were Russia (3371 mt), Canada (993 mt) and Japan (647 mt).

Transactions in domestic pure nickel spot market were thin in October as bearish outlook for nickel prices prompted downstream buyers to hold back from purchasing. Spot premiums kept falling along with declining SHFE nickel prices, reflecting sluggish spot market. Roughly 62% of refined nickel imported in October was stored in special areas under customs supervision, while general trade accounted for merely 37.9% of total imports, down 14.18% percentage points MoM. This means that even though import volume rose, most of the imported refined nickel was stored in bonded warehouses instead of being shipped to the domestic spot market.

Imported refined nickel that was cleared through customs was mostly held as inventory or warrants, causing social inventory and warrant inventory to surge simultaneously in October.

Affected by poor domestic demand and growing use of domestic electrowinning nickel as a substitute for imported nickel, customs clearance of pure nickel should decline in November.