China Sees Big Rise in Nickel Ore Inventories, SMM Reports

The Intertropical Convergence Zone (ITCZ) is currently affecting Palawan, the Visayas and Mindanao, bringing cloudy conditions, scattered rains and thunderstorms. ITCZ expected continue affecting Caraga, Northern Mindanao and most of the Visayas through September 29, with rain and thunderstorms potentially continuing into October 2 due to an additional weather system. For the Philippine nickel industry, Palawan, Surigao and Homonhon may see intermittent moderate to heavy rainfall, which could temporarily slow mine-road transportation, ore barging and vessel loading. Potentially, it could trigger localized flooding or landslides in affected areas. SMM views that The ITCZ is currently a weather-related operational risk rather than a broad supply disruption. Short-duration heavy rain could cause temporary delays in mining and logistics, but the overall impact will depend on rainfall intensity and persistence at individual mining and loading sites.

On September 28, Indonesia's nickel ore market remained stable, with prices for major grades unchanged: Ni 1.2%: $26.5/wmt, unchanged; Ni 1.3%: $28.5/wmt, unchanged; Ni 1.4%: $51.8/wmt, unchanged; Ni 1.5%: $58.5/wmt, unchanged; Ni 1.6%: $63.4/wmt, unchanged. In the market, additional 2026 RKAB quotas are gradually being approved and released, but the total additional quota for the year has yet to be officially announced. Market attention is gradually shifting toward actual mine production and nickel ore shipments. Meanwhile, water shortages caused by El Niño continue to affect the nickel industry in Sulawesi. Since September 22, operating rates at some RKEF lines at IMIP have fallen by around 30%–40%. SMM estimates that if the impact persists for half a month, NPI production could decline by around 50,000–70,000 mt in physical tonnage, equivalent to approximately 5,500–7,700 mt of contained nickel. As of September 28, no nickel smelter in Sulawesi had declared force majeure.

On September 28, the average price of SMM #1 refined nickel was 125,700 yuan/mt, down 1,200 yuan/mt from the previous trading day. In terms of spot premiums, the average premium for Jinchuan #1 refined nickel was 3,800 yuan/mt, up 100 yuan/mt from the previous trading day, while domestic mainstream electrodeposited nickel ranged from 0 to 500 yuan/mt.