[SMM Analysis] The Nickel Salt Market Remained Stable This Week, with Nickel Salt Smelters Maintaining Sentiment to Stand Firm on Quotes

This week, the nickel salt market remained stable, with nickel salt smelters maintaining a strong sentiment to stand firm on quotes.

As of Thursday, the SMM battery-grade nickel sulphate index price stood at 26,598 yuan/mt, with the quotation range for battery-grade nickel sulphate between 26,400-27,080 yuan/mt, and the average price remained flat WoW.

Demand side, most ternary cathode precursor plants had completed restocking nickel salt raw materials for February before the Chinese New Year. Although some precursor plants still had minor restocking needs, market activity was low this week, mainly focused on inquiries, with overall transactions remaining sluggish.

Supply side, some nickel salt smelters had not resumed production due to losses. As production remained unprofitable, nickel salt smelters showed no signs of price concessions this week, with a strong sentiment to stand firm on quotes.

Given that next week marks a key period for nickel salt procurement, nickel salt smelters' quotes remained firm. Meanwhile, there was still some restocking demand for February, and raw material procurement for March would gradually start next week. Therefore, nickel sulphate prices are expected to rise next week.

This Week, Cost Support for Nickel Sulphate Weakened

From a cost perspective, the MHP market saw low trading activity this week, mainly focused on inquiries, with overall transactions remaining sluggish. Currently, the MHP coefficient remained stable. For high-grade nickel matte, limited room for seller concessions driven by costs also kept the coefficient stable this week. Recently, the favourable macro sentiment from the Philippines had been gradually digested by the market, with bearish fundamentals exerting some pressure on LME nickel prices, leading to a pullback in LME nickel prices. As a result, the spot production costs of MHP and high-grade nickel matte both declined WoW. Currently, producing nickel sulphate using MHP and nickel slag still faced varying degrees of losses, while producing nickel sulphate using high-grade nickel matte had turned profitable. Based on Thursday's spot profit data, the profit margin for producing nickel sulphate using nickel slag was -2.2%, using MHP was -0.7%, and using high-grade nickel matte was 2.5%.

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