This week, inquiries in the MHP market were active, and overall transaction prices rose. Supply side, affected by the tailings dam landslide at some MHP projects in an Indonesian industrial park, some MHP production lines maintained low operating rates, and MHP supply was limited. Demand side, March was the peak season for new energy, and enterprises showed stronger purchasing willingness. Under the overall tight supply and demand pattern, sellers showed strong willingness to hold prices firm, pushing the overall transaction price higher. Looking ahead, supply side, on the one hand, tensions in the Middle East brought strong uncertainty to sulfur supply, and MHP supply is expected to contract; on the other hand, IUI applications for new MHP projects were still under review, leaving no short-term increment to market supply. As downstream stocking demand is released, nickel payables and cobalt payables are expected to hold steady at high levels.
The high-grade nickel matte market remained in tight balance, and the coefficient rose, driven by the increase in MHP payables. Spot market circulation was limited, and the price center of transactions among mainstream sellers moved higher. Looking ahead, supply side, as NPI economics improved, some production lines reduced conversion output, and high-grade nickel matte production is expected to decline; demand side, high-grade nickel matte played an obvious supplementary role as an alternative raw material to MHP. Under the tight supply-demand relationship, nickel payables are expected to be difficult to decline.
As for sulfur, a key auxiliary material, prices continued to rise this week, affected by a sharp reduction on the supply side. Supply side, Qatar's March sulfur contract price was FOB $520/mt, flat MoM. However, the Middle East situation remained deadlocked and was unlikely to ease in the short term, making Middle East prices unworkable for actual transactions, and enterprises sought other import sources. Looking ahead, sulfur prices are more likely to rise than fall, and subsequent sulfur price movements will depend on developments in the Middle East situation and actual port arrivals.
As for nickel prices this week, geopolitical tensions in the Middle East escalated sharply, rapidly lifting market risk-off sentiment. Together with the US Fed keeping interest rates unchanged while raising inflation expectations, expectations for interest rate cuts were revised down, leading to a broad decline in metal prices. Overall, nickel prices fell WoW this week. However, combined with higher payables, overall MHP and high-grade nickel matte nickel prices rose this week, while MHP cobalt prices increased as refined cobalt prices rose.
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