No one believed in you, yet you rose to the top...——Laterite nickel ore prices surged strongly [SMM Analysis]

Published: Aug 16, 2024 18:09 (GMT+8)

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SMM August 16th News,

Philippine Nickel Ore Prices Continue to Rise
Over the past week, the market price of Philippine laterite nickel ore has shown a strong upward trend. Firstly, the strong demand for laterite nickel ore from Indonesia is the main factor driving up the price of Philippine laterite nickel ore. Currently, the price of medium-grade laterite nickel ore has risen from $45/wmt at the beginning of the month to around $48/wmt. This indicates that the sales price of Philippine laterite nickel ore to the Indonesian market continues to rise.

On the other hand, the increased demand for laterite nickel ore in the Indonesian market has pushed up the domestic price of Philippine laterite nickel ore. Specifically, the price of 1.4% grade Philippine laterite nickel ore has risen to between $47 and $48/wmt. Based on the restocking situation of downstream smelters, it is expected that the price of Philippine laterite nickel ore will still have room to rise in the short term.

Rising Premiums for Indonesian Domestic Trade Laterite Nickel Ore
Meanwhile, the price of Indonesian domestic trade laterite nickel ore is also continuously rising. Currently, the CIF price of 1.6% grade domestic trade laterite nickel ore remains in the range of $49.6 to $52/wmt. During market transactions, the premium range has risen to $22 to $23/wmt, and policies such as silicon-magnesium ratio rewards have further increased the procurement costs for smelters.

It is worth noting that the supply of Indonesian laterite nickel ore remains tight. Due to various factors such as mining capacity and efficiency, the growth rate of circulating laterite nickel ore in the market is slow. The supply situation on Halmahera Island is particularly more severe than on Sulawesi Island. Due to the recent active price competition among downstream smelters and traders, it is expected that the price of domestic trade laterite nickel ore will still have the potential to rise in the short term.

Laterite Nickel Ore Supply Situation and Price Forecast
Overall, the current tight supply situation in the laterite nickel ore market remains severe. Although the Indonesian Ministry of Energy and Mineral Resources (ESDM) stated that the approval quota for domestic trade laterite nickel ore this year has reached 240 million wmt, the actual growth rate of circulating laterite nickel ore in the market remains slow. Some mines, due to limited mining capacity, find it difficult to significantly increase the actual monthly sales volume of nickel ore in the short term. Additionally, the infrastructure damage caused by the rising price of laterite nickel ore also hinders the supply increase.

It is worth mentioning that although the Indonesian government has stated that the current approval volume can meet the estimated market demand for this year (210 million wmt), the market remains highly concerned about whether there will be additional approval quotas for laterite nickel ore in Q3 and Q4 this year. Current market information indicates that there is an expectation of additional quotas by the end of Q3.

In summary, due to the active price competition among downstream smelters and traders, coupled with the tight market supply, it is expected that the price of laterite nickel ore will still have an upward trend in the short term. The future market will continue to monitor policy changes and supply chain dynamics to determine the price trend.

nickel prices price of nickel

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

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