NPI Prices Kept Falling amid Sluggish Demand and Lower Costs

SHANGHAI, Jun 15 (SMM) - As of the end of May, the prices of Ni 8-12% high-grade NPI stood at 1,542.5 yuan/mtu (ex-factory, tax included), down 92.5 yuan/mtu from the beginning of the month. The stainless steel market was bleak during the month, hurting the demand for NPI. SHFE nickel prices remained high, but this provided little support to NPI prices. The end demand was hit by the pandemic, causing stainless steel inventories to accumulate and sending its prices lower. Shrinking profits prompted stainless steel mills to bargain down purchase prices. In order to avoid excessive costs, stainless steel mills made fewer inquiries. NPI plants refrained from selling at lower prices initially, but made compromise subsequently due to sluggish demand and the fact that they still had profit margins. High costs constrained the downside room of NPI prices.

NPI prices have extended its downward trend into June. Although the impact of the pandemic has eased, the large number of stainless steel inventories suppressed the stainless steel market, which in turn pressured NPI prices. In addition, lower nickel ore prices also contributed to the decline in NPI prices. The current NPI supply is ample. SMM expects the high-grade NPI prices to trade between 1,400-1,500 yuan/mtu (ex-factory, tax included) in June.