South Korea’s nickel sulphate market remained weak in September amid subdued demand across the domestic NCM value chain and soft buying sentiment in China. In August, Korea’s total nickel sulphate exports fell by around 9% month on month. Exports to China declined by about 37%, while shipments to Japan increased by roughly 38%. In September, CIF China prices for Korean nickel sulphate fell more sharply than China’s domestic prices, indicating continued pressure on China-bound sales through the end of the month.
Exports to China Decline While Shipments to Japan Increase
Korea’s total nickel sulphate exports decreased by around 9% month on month in August. By destination, exports to China dropped by about 37%, while shipments to Japan rose by approximately 38%, resulting in a notable shift in the export mix. The increase in shipments to Japan offset a significant portion of the decline in China-bound volumes, limiting the contraction in total exports.
Korea’s nickel sulphate imports also fell by around 38% month on month. The simultaneous decline in exports and imports indicates that overall trading and physical flows in the Korean market slowed from the previous month. However, monthly trade volumes can be affected by contract and shipment timing, meaning that changes in domestic end-user demand should be assessed together with trends over the coming months.
The decline in China-bound exports and increase in shipments to Japan should not yet be interpreted as a structural change in Korean suppliers’ sales strategies. Nevertheless, differences in pricing and purchasing conditions across major export markets appear to be increasingly relevant to the allocation of export volumes.
Korean CIF Prices Fall More Sharply Than China Domestic Prices
Price trends also reflected continued pressure on China-bound sales. From September 4 to 30, China’s domestic nickel sulphate average price declined by around 2.5%, while the CIF China price for Korean nickel sulphate fell by approximately 4.3% over the same period. Both markets weakened, but the adjustment in Korean import prices was more pronounced.
The downward trend continued into the end of the month. China’s domestic nickel sulphate prices declined across the final trading days of September, while Korean CIF prices also recorded a further adjustment at month-end. This suggests that downstream purchasing had yet to show a meaningful recovery despite the market entering its traditional peak season.
Price negotiations for China-bound cargoes also reflected a widening gap between buyers and sellers. Chinese buyers continued to seek lower import prices in response to weak domestic market conditions, while Korean suppliers had limited room for further reductions given raw-material and processing costs. This divergence in price expectations continued to constrain transaction activity.
Domestic Production Weakens, but Supply Adjustments Remain Constrained
Nickel sulphate production activity in Korea has also been affected by weak demand across the NCM value chain. Operating levels at some producers have declined, while the domestic market has remained insufficient to absorb available production comfortably.
However, nickel sulphate production cannot always be stopped and restarted immediately in line with changes in demand. Extended shutdowns can add both time and cost to the restart process, meaning that a certain level of production may need to be maintained even in a weak-demand environment.
This production structure increases the importance of external sales channels when domestic demand is subdued. At the same time, weak NCM and precursor demand in China means that both further production cuts and export expansion remain challenging for Korean producers.
China’s NCM Demand Recovery to Be the Key Q4 Variable
In September, selling interest in China’s nickel sulphate market remained stronger than downstream buying interest. Even during the traditional September-October peak season, NCM and precursor production and procurement failed to show a clear acceleration, tempering expectations for a rapid demand recovery.
The key variable for Korea’s nickel sulphate market in the fourth quarter will therefore be the extent to which Chinese NCM and precursor production recovers after the National Day holiday. In some previous periods, stronger Chinese nickel sulphate conditions in the fourth quarter improved the sales environment for imported material, but clear signs of such a recovery remained limited through the end of September.
If Chinese demand remains slow to recover, changes in Korean domestic NCM production and export flows to major Asian markets, including China and Japan, are likely to become increasingly important indicators. Conversely, a recovery in Chinese downstream production could ease some of the pricing pressure seen on China-bound Korean material in September, making both price and export-volume trends key indicators to watch in the fourth quarter.
