SHANGHAI, Nov 23 (SMM) — The forecasted global output of iron-nickel  (FeNi) in 2020 is likely to increase slightly to 429,000 mt (Ni content), from 415,000 mt (Ni content)  compared to a year ago.

A rise in global output resulted from the production recovery of Onça Puma, the stable operating rates in major NPI plants, and the enhanced productivity in the reconstructed plants, driven by strong demand from stainless steel plants and the FeNi producers' compromise prices for shipment.

Taking the purchase prices of Chinese stainless steel plants as an example, the premiums of FeNi gradually turned into discounts from 2019 to 2020, and the plants’ purchase prices of long-term contracts stood stably over $1000 higher than the average discounts of LME FeNi.

Like refined nickel, the growing force of FeNi supply has been limited by its high costs and low consumption. The only new production project in recent years is ANTAM’s East Halmahera plant. It’s construction has been completed by 98%, but it failed to be put into production as planned in 2020 due to the COVID-19 pandemic. The compound growth rate of FeNi in next three years is expected to be around 2%.

FeNi global output and production capacities in 2020

Data source: SMM

According to SMM data, 2020's global operating rates in FeNi plants reached 73%, a relatively high level, and COVID-19 pandemic did not have a significant impact on output. Output of Koniambo smelter in New Caledonia is reduced from last year because it only ran one production line in the second and third quarters due to the pandemic.

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