NPI and Refined Nickel Price Spread Expands-Shanghai Metals Market

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NPI and Refined Nickel Price Spread Expands

Price Review & Forecast 05:34:01PM Jan 30, 2013 Source:SMM

SHANGHAI, Jan. 30 (SMM) – According to SMM statistics, price spread between #1 refined nickel and NPI has been expanding, and transactions of NPI stagnated.
 

Date
Weekly Average Price of EMM
 
Weekly Average Price of High-grade NPI
Price Spread
Week ending on January 11th
RMB 122,270/mt
RMB 1,165/mtu
RMB 42.3/mtu
Week ending on January 18th
RMB  123,350/mt
RMB 1,156/mtu
RMB 77.5/mtu
Week ending on January 25th
RMB 123,550/mt
RMB 1,150/mtu
RMB 85.5/mtu

Since stainless steel mills had ample inventories in November and December 2012 and NPI producers had tight cash flow pressure, stainless steel mills tried to beat down NPI procurement prices.

Stainless steel mills' February biding prices for high-grade NPI was relatively low, so NPI producers were reluctant to move goods, resulting in limited transactions of NPI. 

Based on SMM historical data, nickel prices were relatively firm in 1Q every year, with performance most striking in February every year.

A slew of economic data will be released this week, including GDP, the Fed interest rate, nonfarm employment report and PMI from China, US and the euro zone. If the data are positive, base metal prices may be pushed up.

Possible price hike of LME nickel may fuel market expectation that NPI prices may advance after holiday.
 

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NPI and Refined Nickel Price Spread Expands

Price Review & Forecast 05:34:01PM Jan 30, 2013 Source:SMM

SHANGHAI, Jan. 30 (SMM) – According to SMM statistics, price spread between #1 refined nickel and NPI has been expanding, and transactions of NPI stagnated.
 

Date
Weekly Average Price of EMM
 
Weekly Average Price of High-grade NPI
Price Spread
Week ending on January 11th
RMB 122,270/mt
RMB 1,165/mtu
RMB 42.3/mtu
Week ending on January 18th
RMB  123,350/mt
RMB 1,156/mtu
RMB 77.5/mtu
Week ending on January 25th
RMB 123,550/mt
RMB 1,150/mtu
RMB 85.5/mtu

Since stainless steel mills had ample inventories in November and December 2012 and NPI producers had tight cash flow pressure, stainless steel mills tried to beat down NPI procurement prices.

Stainless steel mills' February biding prices for high-grade NPI was relatively low, so NPI producers were reluctant to move goods, resulting in limited transactions of NPI. 

Based on SMM historical data, nickel prices were relatively firm in 1Q every year, with performance most striking in February every year.

A slew of economic data will be released this week, including GDP, the Fed interest rate, nonfarm employment report and PMI from China, US and the euro zone. If the data are positive, base metal prices may be pushed up.

Possible price hike of LME nickel may fuel market expectation that NPI prices may advance after holiday.