Market purchases were sluggish amid weak demand, NPI prices are expected to be under pressure in the short term [NPI Daily Review]

On July 2, the price of SMM 8%-12% high-grade NPI averaged 965.5 yuan/mtu (ex-factory, tax included), down 1 yuan/mtu from the previous working day. Supply side, domestically, NPI prices fluctuated downward, and market expectations for the future gradually weakened. It is expected that domestic NPI production in July may decline. In Indonesia, current NPI prices have dropped notably. Although high-grade nickel matte prices declined, there was still a drive for production conversion from NPI to high-grade nickel matte. With the new production lines in Indonesia, Indonesian NPI production is expected to increase in July, but the growth will be limited. Demand side, a steel mill in South China saw a new low in NPI transaction prices recently, causing the market focus to fall again. Entering the off-season, stainless steel mills may cut production amid weak expectations. Therefore, they adopted a wait-and-see stance towards procurement. In summary, in the short term, NPI supply will remain stable, but prices are expected to be under pressure due to weak demand.