SMM Analysis: Reasons for the Increase of NPI Output in Mar and Apr

The nickel market has been volatile recently, followed by the NPI market. With upstream and downstream hard to agree on prices, the transactions were light. But excluding the rising sentiment brought by the soaring nickel, the supply of domestic stainless steel of nickel products was tight, while it was a support for ferronickel prices. It is expected that iron prices would be in an upward trend among stability in short term. According to SMM research, after the LME resumption, the import window is still hard to open in the short term. Under the high price spread, the import losses of refined nickel and FENI are difficult to make up. And the supply shortage of domestic refined nickel and FENI may continue, while the high-grade NPI with better economy may become the focus of market. In the short term, ferronickel prices were at high. If profits of iron mills continue to improve, output of ferronickel in March to April may see a significant increase. In February, due to the short natural days, environmental policies and other irresistible factors, output of high-grade NPI was only 26,800 mt in nickel content. But in March, with the liberalisation of policies and market driven, output of high-grade NPI is expected to be around 32,500 mt in nickel content. And with the Philippines gradually through the rainy season in late March, the supply of nickel ore will gradually climb, and lay the foundation for the increased output of NPI. SMM predicted that output of high-grade NPI in April may stand at 35,000-38,000 mt in nickel content. At the same time, it also means that as the supply increased due to the pass of rainy season, nickel ore prices will differ from the same period in previous years under the favourable market conditions. Focus on the market trend of stainless steel and steel mills production plans as well as nickel price trend after LME opens.