Announcement of Indonesian Domestic Nickel Ore Prices on SMM

Dear User, Greetings!

Indonesia's nickel ore market is maturing with notable divergence between domestic benchmark and actual trade prices, which vary with supply and demand. The benchmark's relevance has lessened. Responding to these shifts, SMM will introduce two new price points from Dec 1, 2023, following extensive research.

Indonesian domestic laterite nickel ore with 1.2% nickel content (delivery to factory price), and Indonesian domestic laterite nickel ore with 1.6% nickel content (delivery to factory price).

SMM Information & Technology Co., Ltd. (SMM) is an independent third-party service body. It doesn't participate in transactions but communicates with buyers and sellers, providing market services. Through dialogue with industry professionals, SMM continuously develops, reviews, and revises its methodology, using the most common product specifications, trade terms, and conditions, and giving equal attention to standard transactions that meet specifications.

SMM reserves the right to exclude any price information deemed unreliable or unrepresentative from its price assessment judgment. SMM publishes daily spot metal prices (or indices, including the Chinese market, markets outside China, and global markets), commonly referred to as SMM prices. To adapt to the actual conditions of the spot market, SMM will make necessary revisions to the price methodology and announce them on its official website before formal implementation. This document stipulates the pricing mechanism for Indonesian domestic laterite nickel ore with 1.2% and 1.6% nickel content (delivery to factory price), aiming to establish a transparent and verifiable SMM price assessment mechanism.

Formation of SMM prices for Indonesian domestic laterite nickel ore 1.2% (delivery to factory price) and laterite nickel ore 1.6% (delivery to factory price):

1. Definition

The SMM Indonesian Domestic Nickel Ore Price uses 1.2% and 1.6% grades as benchmarks for low and high-grade nickel ore, respectively. Formed by SMM, this price can guide settlement for Indonesian domestic nickel ore prices. It shows the indicative range of spot prices that are most likely to be traded before the weekly spot prices for Indonesian Laterite Nickel Ore 1.2% and 1.6% (delivery to factory price) are released.

2. Brief Introduction to the Formation Method

In line with the IOSCO standard, this document explains the SMM Indonesian Domestic Nickel Ore price calculation method and transaction sample data processing, creating a clear, accurate, and verifiable Indonesian nickel ore price reporting mechanism. The price primarily comes from transaction prices in major Indonesian trading areas like Morowali, Wedabay, OBI, Pomalaa, and represents a delivered price.

3. Method of Price Collection

SMM, in accordance with the price submitter agreement, will have its price analysts regularly collect related data information on the spot prices of Indonesian Laterite Nickel Ore 1.2% and 1.6% via telephone, QQ, WeChat, fax, and email from the liaison of the price submitters between CST 9:30 and 11:20 every Friday morning. Price data information submitted after 11:20 will not be used as a basis for the day's price evaluation, and incomplete data that does not include the required minimum information details, even if submitted before the deadline, will not be used.

The price data information can include the price of transactions that have occurred that week, the expected most likely pending transaction price, offers, counteroffers, etc. All instant messaging content, email communication content, and any records of face-to-face communication will be archived; the details of telephone communication will be summarized, recorded, and entered into the database. The price data information must be from typical, repeatable transactions between non-associated market persons (financially and legally completely independent).

The SMM price analysts must adhere to the business ethics code when reporting any communication content from market persons that is under compulsion or threat, or any kind of indicative offer attempting to influence the evaluation result. The price data information provided by the price submitters to SMM should at least include the following content, and SMM's price analysts should encourage the price submitters to submit as many related detail information as possible, not just the specified minimum requirements.

4. Evaluation (Calculation) of the Published Price

Between CST 11:20 and 11:30 every Friday, the price derived from the complete collection and standardized calculation will be published in the form of a range.

5. Price Announcement

SMM will determine the delivery-to-factory prices of Indonesian domestic trade Laterite Nickel Ore 1.2% and 1.6% according to certain standards and regulations, and these will be publicly announced on SMM's official website, www.smm.cn. The announcement time is between CST 11:20 and 11:30 every Friday morning (excluding Chinese legal holidays and weekends). The cut-off time for price collection is 11:20 on Friday morning, with the following 10 minutes being used for data verification and price calculation. However, the announcement time may be affected by various emergencies and force majeure factors such as power outages and natural disasters. In such cases, SMM will make every effort to publicly inform the market of the delayed price announcement time as soon as possible.

6. Pricing Units and Presentation

Specifications for Indonesian laterite nickel ore 1.2%: nickel content of 1.2%, iron content of no less than 45%, and a moisture content of 35%.

Specifications for Indonesian laterite nickel ore 1.6%: nickel content of 1.6%, iron content of no less than 25%, and a moisture content of 35%.

Unit: $/wmt

Pricing Format: Range pricing, delivery-to-factory price.

Quantity: Minimum unit of 50,000 mt.

Delivery Locations: Includes but is not limited to smelter factory warehouses in Morowali, Wedabay, OBI, Pomalaa, etc.

Online Update Times: Every Friday at CST 11:30 AM.

We invite more industry chain enterprises to join and support SMM in offering improved services to nickel ore-related businesses. For queries, contact Wang Cong at 021-5166 6838, Zhang Lingying at 021-5166 6775, or Fu Jian at 021-51666863.