China NPI, nickel ore prices inch up on nickel price gains

Prices of China’s nickel pig iron and concentrate inched up this week, thanks to higher metal prices.

Prices of China’s nickel pig iron and concentrate inched up this week, thanks to higher metal prices.

On Tuesday May 12, NPI of 10-15% content was trading at 950-1,000 yuan ($155-163) per tonne, compared with a range of 950-980 yuan per tonne a week ago.

Meantime, nickel ore of 1.8% content was trading at $70-73 per tonne, compared with $62-64 per tonne last week.

“There hasn’t been any major change in fundamentals, it is just because of the recent gains in nickel metal,” a dealer in southern China said.

The alloying metal has posted continuous and solid gains on both the Shanghai Futures Exchange and London Metal Exchange since late April.

The higher prices for metal nickel have prompted at least one stainless maker to restart purchasing NPI from the spot market.

The producer had halted purchasing in the past few weeks in hopes for lower NPI prices, although a company official said on Tuesday that the restart was for “inventory adjustment”.

Market sentiment has also improved.

“NPI prices may keep rising if metal prices remain underpinned, and it is likely that NPI will reach 1,200 yuan per tonne,” an official at a stainless maker in south China said.

Upstream, NPI makers have also started asking for nickel ore prices as their purchase interest rises.

“More have been asking about nickel ore offers since last week. There is no shortage of supply. But the key is price, as miners are raising their offers,” a major dealer said.

Another major nickel ore importer said on Tuesday the company has sold out its nickel ore for the month, and has nothing to deliver till next month.

But some are more wary on outlook.

“The prediction of 1,200 yuan per tonne [for NPI] may be too bullish. It is even hard to see the current price level of 1,000 yuan getting underpinned,” a fourth dealer said.

“This round of gains in nickel prices is just a rebound. Only if the nickel prices can stand above $14,600 [per tonne] can NPI prices post further gains,” he said.

By midday of Wednesday May 13, LME three-month nickel was trading around $14,175 per tonne, with the Shanghai Futures Exchange July nickel contract closing the morning session at 111,180 yuan ($18,176) per tonne.

Linda Lin

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