Downstream purchase of nickel plates increased after prices falling below 130,000 yuan/mt, delivery of nickel briquette long-term orders suppressed recent demand

SHANGHAI, May 19 (SMM)—Nickel prices kept falling from high levels last week. Downstream purchase of nickel plates increased after prices falling below 130,000 yuan/mt, and the transaction turned active. Mainstream quotations for nickel plates also trended higher to the flat level amid the sufficient supply of Russian nickel despite the limited arrivals. The premiums of Jinchuan nickel rose to about 2,700 yuan/mt as the plants raised the ex-factory prices due to the maintenance. Traders lowered the prices of Sumitomo Nickel and Norwegian nickel plates to promote transactions amid large amounts of arrivals. The spot trading of nickel briquette was flat, mainly because nearly 1,000 mt of long-term orders had been delivered to the downstream users during the Labour Day long holiday. At the same time, the non-duty-free nickel briquette ordered by some customers passed the customs clearance, and the downstream demand for nickel briquette was low. Quotations for original nickel briquette remained high due to the tight supply, while the quotations for non-duty-free briquette were lowered to 800 yuan/mt.

LME nickel briquette stocks kept falling, downstream high production to boost consumption in the long term

The downstream new energy industry maintained high demand for nickel sulphate, consuming 8,000-9,000 mt of nickel briquette per month as raw materials. The long-term orders of original nickel briquette were only about 3,000 mt, so the domestic consumption of nickel briquette will remain high in Q2 and Q3, which will drive the decrease in LME stocks. Most of the LME stocks were shipped to Singapore and Malaysia. The volume shipped to China will be released by China’s customs.

Spots flowed into domestic market, but inventories remained low

The trading was sluggish in bonded areas during the holiday, but some nickel briquette and plates entered domestic market last week as the import losses narrowed. Inventories of refined nickel in the Shanghai bonded areas decreased 600 mt from a week ago to 8,700 mt as of May 14, showed SMM data.

Domestic social inventories increased 1,412 mt or 5.14% from May 7, with the social inventory of nickel briquette up 500 mt to 6500 mt. Some Jinchuan nickel and hundreds of tons of Norwegian nickel plates arrived in Shanghai, and the non-duty-free LME nickel briquette passed the customs clearance last week. Jiangsu saw the outflow of warehouse receipts, but the inventory increased as the long-term orders from Xinjiang smelters arrived in Wuxi and Changzhou. The inventory in Liaoning increased due to the arrival of Xinjiang Bofeng nickel. The inventory in Guangdong increased over 200 mt as the long-term orders of Sumitomo nickel were delivered. Only Tianjin saw decrease in the inventory as the local traders did not restock.