Nickel sulphate prices may see an increase this week amid tightening supply 

The SMM battery-grade nickel sulphate index reached 26,289 yuan/mt on January 18, up 15 yuan/mt compared to January 11. Quotes of battery-grade nickel sulphate were 26,100-26,600 yuan/mt, remaining unchanged from January 11. Nickel sulphate prices remained stable last week, with the index slightly increasing. Nickel sulfate market transaction coefficients are mostly based on discounts in the range of 95-97% offered by SMM. The coefficients were slightly higher compared to last week's 94. The main reason for the increase is the intensification of supply and demand tensions, leading to a current situation of scarce spot goods in the market. From the supply side, the significant reduction in production in December and manufacturers selling existing stocks at low prices to recollect funds have led to already low inventories in nickel salt enterprises. The low prices of nickel sulphate have not shown a clear rebound, causing some nickel salt enterprises to operate below their cost lines. In January, nickel sulphate production is still declining, indicating a weak supply. There has been a slight recovery in overseas orders in January. The export of ternary precursor orders increased, leading to a small incremental demand for nickel sulphate. Additionally, with the approach of the Spring Festival, some ternary precursor enterprises may have production reduction or shutdown plans in February. As a result, in January, some companies that produce ternary precursors exceeded their production for the demand expected in February. This led to a shortage of raw materials for the long-term procurement of ternary precursors. In general, the tightness in the spot market, combined with periodic purchases and a rebound in overseas demand, has led to an increase in the demand for nickel sulphate. Recently, there has been active nickel sulphate inquiry and transactions. In terms of costs, the reduced production at the First Quantum Minerals has created market tension. The supply tightness has not improved yet, leading to an increase in raw material coefficients. With strong current price support, it is expected that nickel sulphate prices may see an upward trend this week. The current supply and demand for nickel sulphate raw materials seem relatively ample. There is limited potential for price increases. It is expected that the price range for nickel sulphate this week will be between 26,300 and 26,800 yuan/mt.