Supply in the Spot Market was Tight, and the Heightened Production of Integrated Enterprises Failed to Fully Address the Supply Tightness of Nickel Salt

SHANGHAI, Sep 15 (SMM) - In August, the price of battery-grade nickel sulphate moved all the way up from 36,850 yuan/mt at the beginning of the month to 38,100 yuan/mt around the end of the month, an increase of 3.4%. The supply in the spot market tightened further. The downstream players raised their purchase prices in light of supply shortage. However, nickel sulphate was in small oversupply throughout August. The main reason is that the supply growth was mainly contributed by integrated precursor enterprises, which will not circulate in the spot market. Hence the supply in the spot market remained relatively low. And nickel sulphate still had upside momentum with demand for spots.

In September, the market demand for battery-grade nickel sulphate is still picking up, and the capacity utilisation rate of integrated precursor manufacturers using high-grade nickel matte and hydrometallurgy intermediate products as raw materials has also risen. The new production lines of some salt plants will also be put into production around October. In summary, the output of battery-grade nickel sulphate will continue to increase in September. The supply tightness in the spot market is likely to ease. Judging from the current supply of raw materials, the supply of MHP and high-grade nickel matte is still greater than the demand, and the price difference of finished products caused by diversified supply-demand balance of various raw materials still exists. Hence the market prices under negotiations now fall into a wider range. The market quotes are likely to rise in the near term amid high nickel prices. It is expected that the purchase price in the spot market in September may be in the range of 37,600-39,000 yuan/mt. And it is basically flat over the current level. SMM launched the SMM Battery Grade Nickel Sulphate Price Index and SMM MHP Coefficient (benchmarking SMM Battery Grade Nickel Sulphate Price Index) starting from September 1. The item of SMM Battery-grade Nickel Sulphate Price will stop updating starting from the end of 2022. September SMM battery grade nickel sulphate price index: MTD 38100 yuan/mt; September SMM MHP Coefficient: MTD 73%