[SMM Analysis] MHP and High-Grade Nickel Matte Prices Rose This Week

This week, MHP market transactions were limited. On the demand side, nickel salt and refined nickel plants generally showed low purchase willingness for spot cargo, mainly adopting a wait-and-see attitude, with strategies favoring rigid stockpiling for next year's Q1 and "buying on dips." On the supply side, some traders had limited available inventory for sale, providing support for high quotations. Affected by the DRC's export policies for cobalt intermediate products, MHP's role as a cobalt-containing raw material substitute strengthened. After this round of coefficient adjustments, cobalt payables are expected to remain stable in the short term.

The high-grade nickel matte market continued to experience tight supply, with spot circulating resources remaining insufficient. Despite the tight supply, downstream demand was also weak, especially as some smelters had limited acceptance of the current high price coefficients, leading to overall sluggish trading.

For key auxiliary material sulfur, prices remained flat this week. Affected by the holiday, trading activity decreased, and the price of sulfur (Indonesia CIF) held at last week's level. On the supply side, OPEC+ will implement its plan to pause crude oil production increases in Q1. As sulfur is a by-product of oil and gas processing, market expectations point to a decline in global sulfur production in January, with sulfur prices still having upside room in January.

Regarding nickel prices, expectations of supply contraction driven by Indonesian policies are the dominant market logic currently, stimulating bullish sentiment and leading to a continued sharp rebound in nickel prices. Overall, nickel prices rose WoW this week. In terms of coefficients, nickel prices for MHP and high-grade nickel matte increased, and cobalt prices for MHP also rose.