The purchasing sentiment in the stainless steel market remained weak, and the price of high-grade NPI continued to face downward pressure in the short term. [SMM Nickel Morning Meeting Summary]

April 17 Nickel Morning Meeting Minutes Refined Nickel: SMM Nickel April 16 Report: Spot market: Today, the SMM 1# refined nickel price ranged from 124,650 to 127,900 yuan/mt, with an average price of 126,275 yuan/mt, up 800 yuan/mt from the previous trading day. The mainstream spot premium for Jinchuan No. 1 nickel was quoted at 2,700-3,000 yuan/mt, with an average premium of 2,850 yuan/mt, down 50 yuan/mt from the previous trading day. The premium/discount for Russian nickel was quoted at 50-400 yuan/mt, with an average premium of 225 yuan/mt, unchanged from the previous trading day. Futures market: The most-traded SHFE nickel contract closed at 124,140 yuan/mt, up 0.41% intraday. Technically, SHFE nickel broke through the 10-day moving average resistance, but the 127,000 yuan/mt resistance level has not been effectively breached. Today, the nickel market continued to fluctuate upward, with spot prices rebounding further. However, the supply-demand imbalance and inventory pressure still constrained the upside room, and market sentiment remained cautious. Nickel Sulphate: On April 16, the SMM battery-grade nickel sulphate index price was 27,769 yuan/mt, with the quotation range for battery-grade nickel sulphate at 27,750-28,370 yuan/mt, and the average price decreased slightly from yesterday. Cost side, based on the reduction of Indonesian high-ice nickel, the market demand for MHP increased, driving the MHP coefficient to continue rising. Recent floods in Indonesia have led to a reduction in MHP supply, further pushing up the MHP quotation coefficient. Supply side, this week, due to lower production costs, some non-primary nickel salt smelters have lowered their quotations. Some primary nickel salt smelters have also loosened their quotations. Demand side, some precursor plants have not yet stocked up enough nickel salt inventory for April, and there is still procurement demand this week. However, their price acceptance has declined. Looking ahead, nickel sulphate prices are expected to decline due to weakening costs, but the decline is expected to be limited based on the tight supply and demand of nickel salt. Nickel Pig Iron: On April 16, the SMM 8-12% high-grade NPI average price was 989.5 yuan/mtu (ex-factory, tax included), down 1.5 yuan/mtu from the previous working day. Supply side, domestically, current nickel ore inventory at domestic smelters is low, coupled with declining smelter profits, some companies are still in the maintenance period, and overall production remains low. In Indonesia, the local ore premium has remained stable in the short term, and the policy expectation of increasing the tax rate on nickel ore in Indonesia is strong, with strong cost support for smelters and stable production despite declining profits. Demand side, stainless steel prices have recently fallen sharply, market procurement sentiment is weak, social inventory has accumulated significantly, and stainless steel mills have weak demand for raw material procurement. In the short term, high-grade NPI prices remain under pressure. Stainless Steel: On April 16, stainless steel futures prices remained basically stable, and spot market prices also largely continued the previous level. The market was filled with a strong wait-and-see sentiment, with only some low-priced sources achieving small transactions. At noon, news about the maintenance of 200 series steel mills boosted market sentiment. Futures side, the most-traded contract 2506 fluctuated. At 10:30 am, SS2506 was quoted at 12,825 yuan/mt, down 15 yuan/mt from the previous trading day. In Wuxi, the 304/2B spot premium/discount was in the range of 445-645 yuan/mt. In the spot market, the cold-rolled 201/2B coil in Wuxi and Foshan was quoted at 8,300 yuan/mt; the cold-rolled cut edge 304/2B coil in Wuxi averaged 13,200 yuan/mt, and in Foshan averaged 13,225 yuan/mt; the cold-rolled 316L/2B coil in Wuxi was 23,650 yuan/mt, and in Foshan was 23,800 yuan/mt; the hot-rolled 316L/NO.1 coil in both regions was quoted at 22,900 yuan/mt; the cold-rolled 430/2B coil in Wuxi and Foshan was 7,500 yuan/mt. Currently, macro factors have far greater impact on the stainless steel market than fundamental factors. In this context, stainless steel practitioners have mixed and ambiguous views on the future market direction. Market transactions are mostly concentrated on low-priced sources on the futures market, and the overall market is filled with cautious wait-and-see sentiment, dominating the current market atmosphere, resulting in continued sluggish transactions and overall stable prices. Going forward, market participants need to continue to closely monitor the actual details of the US tariff policy and its specific impact on the market at various stages, in order to adjust strategies in a timely manner and respond to market changes. Nickel Ore: Last week, the price of low-Ni, high-Fe ore in the Philippines remained stable. From a supply-demand perspective, the rainy season in the southern Philippines has basically ended, and shipments of medium-grade nickel ore from Surigao mines are expected to increase. On the demand side, after the introduction of Trump's tariff policy, nickel prices fell sharply, and domestic NPI prices fell within the week, reducing the acceptance of high-priced nickel ore. From an inventory perspective, domestic nickel iron plant inventory is relatively low, and just-in-time procurement demand still exists, but the acceptance of nickel ore prices is limited. On the cost side, the FOB price of NI1.25% nickel ore in Zambales was $32, and the CIF cost remained above $43, but with the shift of shipments to Surigao, the FOB price may see a slight decline. On the ocean freight side, ocean freight rates fell slightly within the week, with the rate from Surigao to Lianyungang, China, down $10-10.5/wmt. Overall, SMM expects that due to the combined impact of increased supply and falling downstream NPI prices, Philippine nickel ore prices may see a slight decline in the future. Last week, global nickel prices fell sharply, with Trump's tariff policy and PNBP policy once again fueling expectations of implementation, and multiple factors disturbing the market. However, as nickel ore orders for the first half of April have been signed, transaction prices remained stable this week. This week's transaction prices in the Indonesian market: for pyrometallurgical ore, the delivery-to-factory price of 1.6% local ore was about $51-52/wmt; for hydrometallurgical ore, the delivery-to-factory price of 1.3% local ore was about $25-26/wmt, unchanged WoW. In April, the mainstream premium for nickel ore procurement in the Sulawesi Island park remained at $24-25, and the CIF price of hydrometallurgical ore remained stable but weak. From a supply perspective, for pyrometallurgical ore: on the supply side, the rainy season in Sulawesi Island has lasted for a long time, and rainfall remained frequent within the week, which has had a certain impact on the mining and transportation of nickel ore. However, overall, rainfall in Indonesia will gradually decrease from April, and nickel ore supply is expected to increase. On the demand side, downstream NPI prices were impacted by the decline in nickel prices brought about by Trump's tariff policy, and NPI prices fell significantly within the week, weakening the support for nickel ore prices. From an inventory perspective: raw material inventory at Indonesian nickel iron smelters is generally low, and just-in-time restocking is needed. Coupled with the expectation of NPI increment, demand support still exists. Overall, SMM expects that the supply of Indonesian pyrometallurgical ore may continue to be tight. For hydrometallurgical ore: on the supply side, the tight supply of hydrometallurgical ore was not obvious within the week. On the demand side, the accident at the hydrometallurgical project in the Sulawesi park affected the demand for MHP in April. Overall, the supply of hydrometallurgical ore is relatively sufficient. On the policy side, Trump's tariff policy impacted nickel prices, and the decline in downstream nickel product prices and the compression of profit margins may be transmitted to the nickel ore end in the future, leading to price and premium declines. However, Indonesia once again fueled expectations of the implementation of the PNBP policy. If the policy is implemented next week, the increase in royalties will lead to an increase in the sales cost of nickel ore, providing some support for nickel ore prices. Overall, the nickel ore end is currently mixed with long and short factors, but the main theme of tight supply remains. The future price trend needs to pay attention to the negotiations between companies and mines on "whether to lower the premium in late April" and the continuation of the rainy season in Indonesia. SMM expects that the price of Indonesian local nickel ore will remain stable in the short term, with limited downside room.