China’s output of nickel pig iron rises 49% YoY in Jul

SHANGHAI, Aug 8 (SMM) – Production of refined nickel in China came in at 12,650 mt in July, up 0.56% from June and 1.61% from July 2018, showed an SMM survey.

SMM learned that a smelter in the middle of July began annual maintenance on one of its production lines, which would last for about one month. The smelter’s another production line will begin maintenance at the start of September. This is expected to impact output by a combined volume of about 2,000 mt.

China’s output of refined nickel, however, is likely to barely change from July in August, as higher output from a smelter in Shandong will offset the losses.

Nickel production is unlikely to receive a boost from smelters who planned to shift from nickel sulphate production to refined nickel, as they may give up the plan in August.

In July, output of nickel pig iron (NPI) in China rose 2.57% from June to 50,700 mt in Ni content. This created a substantial increase of 49.13% from a year ago, as environmental pressure suspended a slew of producers in June-July 2018.

High-grade NPI accounted for 43,500 mt in Ni content, up 3.18% from a month ago, as new capacity in Jiangsu and Liaoning came online and as output from Shandong recovered.

For low-grade materials, the switch to other production or suspension at northern plants lowered output by 0.97% month on month to 7,200 mt in Ni content.

Overall NPI production is expected to climb 3.49% on the month to 52,500 mt in Ni content in August, bolstered by greater output of high-grade materials, in anticipation of the ramp-up of new capacity in Liaoning and production recovery in Inner Mongolia.

Output of high-grade NPI is expected to rise 4.06% to 45,300 mt in Ni content, while that of low-grade materials will remain barely changed at 7,200 mt in Ni content.

China produced 9,714 mt in Ni content of nickel sulphate in July, which translated to 44,200 mt in physical content.

This was up 45.25% from a year ago, but down 5.35% from a month ago, as continued weakness in demand for battery-grade nickel sulphate prompted a shift to refined nickel production or sizable production curtailments at nickel sulphate producers.

Meanwhile, large nickel sulphate producers refrained from production cuts, and newly-commissioned capacity ramped up. This, together with the recovery at some integrated producers of nickel sulphate and precursor, limited the decline in overall output.

Despite poor demand, output of electroplating-grade nickel sulphate held stable last month.

Output of nickel sulphate is expected to rebound in August, rising 9.98% from July to 48,600 mt in physical content or 10,700 mt in Ni content, as improved demand drives producers to recover production.