SHANGHAI, May 31 (SMM) – NPI supply has changed from tightness in March and April to moderate sufficiency at the moment.
On the demand side, stainless steel sector was constantly restricted by the pandemic, and the steel mills purchased only on rigid demand. Stainless steel prices, on the other hand, have been falling while raw material prices have been high, especially nickel-based raw material prices which remained at historical high after LME nickel soared to the all-time peak in March. Steel mills are challenged with narrowing profits, with some starting to suffer losses in April and May. As such, steel mills voluntarily reduced the demand for raw materials.
On the supply side, NPI output was relatively in March and April compared with the same period last year. The output is estimated to have picked up in May as manufacturers gradually resumed the production with easing pandemic situation. However, domestic NPI output has entered the downward trajectory owing to nickel ore supply issues, with limited new capacities. And the increase in NPI supply is mainly contributed by Indonesia NPI.
In terms of the commissioning of NPI production lines in Indonesia, outsourcing demand of Tsingshan and Delong will fall after their own NPI capacity is put into production, which will also increase the goods circulating in the market and available for export to China.
The situation is also evidenced by China’s imports, which has been rising since the beginning of 2022. The imports of NPI recorded 390,500 mt in April, up 0.97% MoM and 39.13% YoY.
![[SMM Analysis] Influenced by macro sentiment, MHP and high-grade nickel matte prices declined this week.](https://imgqn.smm.cn/usercenter/CWsEw20251217171732.jpeg)
