In February 2025, national refined nickel production decreased by 5.69% MoM but was up 15.12% YoY. The industry's operating rate stood at 52%, slightly lower than the previous month. The main reasons were the recent end of the Chinese New Year holiday, with some enterprises not yet fully resuming operations, and the fewer calendar days in February, leading to a decline in production.
In February, nickel prices fluctuated downward before rising, then pulled back and stabilized. In the short term, Indonesian nickel ore prices remained relatively strong due to the following factors: 1. The rainy season in Indonesia affected mining speed; 2. Transportation costs increased due to the impact of the rainy season on logistics; 3. The rainy season raised the moisture content of nickel ore, further increasing costs.
Regarding refined nickel supply and demand, February saw downstream enterprises mostly operating at partial capacity due to the Chinese New Year holiday, coupled with fewer calendar days and mediocre spot market transactions. Domestic demand overall was relatively weak in February. On the supply side, although some enterprises implemented production cuts in February, overall industry supply remained at a high level. As for inventory, SMM's six-location inventory totaled 45,456 mt, with the fundamental supply surplus pattern unchanged.
In March, the impact of the Chinese New Year holiday is expected to dissipate, and demand may recover to normal levels. Under the supply surplus, March production is projected to increase by 13.56% MoM and be up 29.16% YoY.
