SHANGHAI, May 13 (SMM) – Discounts of high-grade nickel pig iron (NPI) against refined nickel are likely to widen in May as greater seaborne arrivals from Indonesia will extend glut in the domestic market, though domestic output will decrease, SMM expects.
NPI demand from stainless steel will weaken in May, as the planned output of #300 stainless steel across major producers is estimated to drop 2.53% from April, to 1.14 million mt in May, SMM assessed. This could also drag on discounts of NPI.
While the domestic new capacity of NPI continues to release in May, maintenance across plants in the east, north, and south may lower domestic production of high-grade NPI by 1.36% on the month to 41,100 mt in Ni content in May.
Prices of ferronickel slid significantly with the nickel market since April, but most producers continue to see profits as lower prices of raw materials, including nickel ore, coke, and coking coal, reduced costs.
However, costs remained high for some electric furnace mills in Inner Mongolia, and drove one into suspension at the end of April. SMM also learned that two local mills held back from purchasing nickel ore, as existing stocks of raw materials were sufficient for a month of production.
