Nickel prices rose sharply, whether nickel sulphate could continue to follow the increase

SHANGHAI, Feb 22 (SMM) – Domestic battery-grade nickel sulphate continued to be in short supply in January 2021, and prices of battery-grade nickel sulphate were on the rise. SMM survey showed that China's nickel sulphate supply in January stood at 16,000 metal mt, and the total demand came in at 17,000 metal mt. The inventories decreased 1,000 metal mt. As the domestic pandemic was controlled and various countries support policies for new energy vehicles advanced, domestic demand for nickel sulphate is increasing month by month. Total consumption of battery-grade nickel sulphate by new energy reached 15,000 metal mt in January. The mainstream transaction prices of battery-grade nickel sulphate stood at 33,500-34,000 yuan/mt (crystal) before the CNY.  

Nickel prices are supported by the macro environment and positive fundamentals, and SHFE nickel has broken through the 140,000/mt mark. In the first week after the CNY, prices of battery-grade nickel sulphate rose significantly to stand at 35,000-36,000/mt (crystal). SMM survey showed that orders from downstream precursor factories continued to be strong. Domestic demand for battery-grade nickel sulphate continued to increase MoM in February, while domestic nickel sulphate supply decreased due to the CNY holiday and restrictions on raw materials (mainly intermediate products). Battery-grade nickel sulphate spot was still in short supply. In addition, SMM domestic nickel sulphate balance data showed that nickel sulphate has been in short supply from September 2020 to now, except for October.

SMM believes that it will be difficult for battery-grade nickel sulphate to return to a state of balance between supply and demand in the near term, and prices of battery-grade nickel sulphate will still have upward room.