SMM NiCoLiMn Summit: China’s nickel market to flip into supply surplus in 2019

Published: Apr 29, 2019 15:08

Save

Primary nickel supply in China is estimated to exceed demand by 23,800 mt in Ni content this year

YIBIN, Apr 29 (SMM) – China’s primary nickel market, including refined nickel, nickel pig iron ferronickel and nickel salts, is expected to flip into a supply surplus in 2019 as greater NPI capacity in China and Indonesia drives supply to grow faster than demand, said Gao Yin, analyst from SMM.

Primary nickel supply in China is estimated to exceed demand by 23,800 mt in Ni content this year, compared with a deficit of 26,700 mt in Ni content in 2018, Gao delegates at the SMM Nickel-Cobalt-Lithium-Manganese Summit on Monday April 29 in Yibin, Sichuan province.

NPI production in Indonesia will maintain high-speed expansion, bolstered by new capacity of Tsingshan, Delong and Jinchuan. The Southeast Asian country is expected to see its NPI capacity to expand to 590,000 mt in Ni content/year from 350,000 mt in Ni content/year, with production for the year growing by 105,000 mt in Ni content to 350,000 mt in Ni content.

Greater NPI output from Indonesia will grow flows into China, which is likely to see an increase of 75,000 mt in Ni content in Indonesian supplies in 2019. A total of 150,000 mt in Ni content of Indonesian NPI is expected to enter the Chinese market this year.

China's NPI capacity will grow and about 100,000 mt in Ni content/year of capacity is likely to be phased out. Output of NPI is expected to gain 89,000 mt in Ni content to 540,000-550,000 mt in Ni content this year. This will grow overall NPI supply by over 160,000 mt in Ni content in 2019, and widen the discount of NPI against refined nickel.

China’s production of 300-series stainless steel, however, is likely to grow at 3% in 2019, versus an increase of 6% in 2018. While output in the first quarter registered a peak in years and rose 9% from a year ago, the growth for the whole year will be smaller as thin profits prompt producers to scale back production in May-June.

Stainless steel accounts for about 80% of primary nickel consumption in 2018-2019.

NPI is estimated to account for 53% of raw materials for stainless steel in 2019, up from 45% in 2018, while the proportion of refined nickel will likely fall from 19% to 15%.

Consumption of primary nickel in the production of stainless steel is estimated to increase by 79,000 mt in Ni content in 2019.

SMM NiCoLiMn Summit

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.

For any inquiries or for more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

2 hours ago

Magnesium Market in the Doldrums, No Notable Fluctuations upon Returning to the Market at the Start of the Week [SMM Magnesium Ingot Spot Flash Report]

[Magnesium Market in the Doldrums, No Notable Fluctuations at Week’s Start] Today, magnesium ingot prices remained in the doldrums overall. Producers in major production areas held prices firm, but downstream demand follow-through remained weak. The market is expected to continue moving sideways in the short term.

2 hours ago

3 hours ago

UK Expands Sanctions to Russia-Linked Tantalum and Niobium Supply Chains

[SMM Express] The UK has introduced sanctions targeting Russian companies involved in the import of tantalum and niobium, alongside broader measures aimed at disrupting supply chains supporting Russia’s defence sector. The move reflects growing government attention to the role of strategic metals in the production of advanced military equipment, including missiles, drones and other weapons. The sanctions could increase scrutiny of Russian-linked tantalum and niobium trade flows, potentially contributing to further supply-chain fragmentation and greater demand for alternative sources. The development nevertheless reinforces the growing relationship between critical minerals, trade policy and geopolitical security.

3 hours ago

4 hours ago

Nigeria’s Columbite-Tantalite Potential Gains Attention as Mineral Trade Diversifies

[SMM Express] Nigeria’s position in the columbite-tantalite (coltan) supply chain is gaining attention as the country seeks to expand its role in global critical-mineral markets. The country was estimated to be the world’s second-largest tantalum producer in 2024, accounting for around 16% of global tantalum production. Nigeria also hosts significant deposits of niobium and tantalum-bearing minerals, particularly columbite-tantalite ores. These minerals are strategically important because tantalum is widely used in high-performance electronics and other advanced applications while niobium is essential for specialised steel and superalloys. The emergence of mineral trading companies focused on consolidating production, verifying grades and improving traceability could help connect Nigeria’s fragmented mining sector with international processors. This is particularly relevant for columbite-tantalite, where ore grade, Ta₂O₅/Nb₂O₅ content, origin and chain-of-custody documentation are important factors for international buyers. Nigeria is also moving towards greater local processing and value addition, potentially creating opportunities beyond the export of raw concentrates. As global buyers seek to diversify critical-mineral supply chains, Nigeria’s columbite-tantalite resources could become increasingly relevant to the international tantalum-niobium market. The key challenge remains converting geological potential into consistent, verifiable and compliant supply capable of meeting international processor requirements.

4 hours ago