[SMM Analysis] Tight Supply-Demand Pattern for Nickel Intermediate Products, Prices Show Upward Trend

Tight Supply-Demand Pattern for Nickel Intermediate Products Drives Price Uptrend

This week, the MHP market saw both supply and demand factors pushing up nickel and cobalt payable indicators alongside prices. Demand side, restocking needs from some nickel salt and refined nickel producers continued to emerge, with stable inquiry activity for MHP providing effective price support. Supply side, limited spot cargo availability prompted some traders to raise offers, while rising cobalt sulphate prices further lifted the cobalt payable indicator in MHP. Combined, these factors drove significant WoW increases in both nickel and cobalt payable indicators, propelling absolute prices higher.

Spot inventory of high-grade nickel matte remained tight, but weak downstream procurement enthusiasm and smelters’ limited acceptance of high coefficients resulted in subdued market activity. Nevertheless, higher nickel prices this week still pushed up absolute prices of high-grade nickel matte moderately.

As a key raw material for nickel intermediate production, sulphur prices sustained an uptrend recently. Specifically, Indonesian sulphur prices rose this week, primarily driven by: 1) higher operating rates in downstream phosphate fertiliser plants boosting demand; and 2) recovering procurement demand in Indonesia’s domestic market. Looking ahead to August, autumn fertiliser stocking season is expected to sustain sulphur demand from fertiliser producers, providing strong price support. Indonesian sulphur prices are likely to remain stable or extend gains in August.

LME nickel prices edged up WoW, initially boosted by supply chain stability concerns amid large-scale protests in Indonesia. Against this backdrop, MHP prices rose under dual support from improved supply-demand dynamics and higher cobalt coefficients, while high-grade nickel matte followed nickel price trends. The overall tight supply-demand pattern for nickel intermediates continues to underpin prices in the near term.