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Spot premiums for refined nickel briquettes came under further pressure in Europe on Tuesday after continued improved availability of material within the region pressured the market lower.
Fastmarkets assessed the nickel briquette premium, in-whs Rotterdam at $500-850 per tonne on Tuesday, down by $50-100 per tonne from $600-900 per tonne on November 22.
The move lower was prompted by a significant divergence in estimates for the valuation of briquettes, with some participants seeing certain London Metal Exchange-deliverable brands as low as $300 per tonne, while others continued to see the market above $1,000 per tonne.
There was no fresh liquidity reported to Fastmarkets though, with long-term contract negotiations continuing to take priority in the region for now.
Participants said that while premiums were under pressure, there had been a slight improvement in demand within the region.
“Demand is definitely better,” a trader told Fastmarkets, noting that a drop in energy prices had encouraged some participants in the alloy and stainless-steel market to begin inquiring about nickel once again.
“Is it better than earlier this year, though? Probably not,” the trader added.
The briquette market appears to be disconnected from that for other refined nickel products in the region, which remain backed by supply uncertainty.
Fastmarkets assessed the nickel 4×4 cathode premium, in-whs Rotterdam at $900-1,300 per tonne on Tuesday, unchanged from the prior week in the absence of fresh liquidity.
Some participants now see certain brands of 4×4 cathodes as high as $2,000 per tonne, but a lack of liquidity at such levels prevents any move for now. Fastmarkets will continue to assess the reflective premium level for 4×4 cathodes in Europe in future pricing sessions.
Similarly, uncut cathode premiums in the region were also flat due to illiquidity.
Fastmarkets assessed the nickel uncut cathode premium, in-whs Rotterdam at $400-800 per tonne on Tuesday, unchanged from a week earlier.
Full plate premiums appear to have diverged in a similar fashion to briquettes, with some indicating as low as $200 per tonne for some brands, while others offering as high as $1,000 per tonne. In the absence of liquidity, the premium range remains unchanged though, and Fastmarkets will look to test such levels in future pricing sessions.
Premium ranges for nickel metal remain wide in the region as a result of different valuations for certain brands of material, with some said to command the lower end of the range, while others achieving higher.
Premiums for nickel full plate imported into China were again unchanged in the week to Tuesday, amid an absence of spot trades.
Import losses continued to hamper buying activity, resulting in limited spot activity being done, but low supply in the market continued to support premiums.
At the same time, market participants were said to be mainly focused on annual negotiations, but these were reportedly in limbo over concerns due to volatility in the LME nickel price.
As a result, Fastmarkets assessed the nickel min 99.8% full plate premium, cif Shanghai at $350-450 per tonne on Tuesday, unchanged since September 20.
The assessment for the nickel min 99.8% full plate premium, in-whs Shanghai was $400-450 per tonne on the same day, also unchanged since September 20.
Elsewhere, nickel briquette premiums continued to lose appeal in competition with an alternative supply of raw materials including mixed-hydroxide precipitate (MHP), which led market sources to suspect the possibility of canceling nickel briquette’s long-term contracts for next year.
Fastmarkets’ monthly assessment of the nickel, min 99.8% briquette premium, cif Shanghai was $100-150 per tonne on Tuesday, unchanged from October 25. The price has, however, dropped by 70% from $450-500 per tonne in September.
A few tonnages from China were reportedly re-exported for delivery into LME warehouses, but sources suggested that the market was not there yet to see positive terms for exports.
US nickel premiums were flat again in the week to Tuesday amid quiet spot activity in the wake of the Thanksgiving holiday (November 24).
Fastmarkets assessed the nickel briquette premium, delivered Midwest, US at 120-180 cents per lb on Tuesday, unchanged since September 27.
Fastmarkets assessed the nickel 4×4 cathode premium, delivered Midwest, US at 120-180 cents per lb on Tuesday, also flat since September 27.
Participants’ views on premium levels were unchanged this week, while spot trading remained limited as 2023 contract negotiations continued.
Recently, several Fastmarkets sources reported several briquette deals. Briquette trade died down this week, but some 4×4 cathode was traded.
Fastmarkets received third-party confirmation of a 4×4 cathode deal at 120 cents per lb and heard of several other deals within the assessment range. Despite the smattering of 4×4 cathode activity, overall liquidity remains low for both grades.
“It is very quiet, the surplus briquettes seem to be circulating in Asia for now. I would call the market unchanged,” a US trader said.
“All is quiet mainly because of the holiday. We heard of some activity on 4×4 but all within your range,” a producer source said.
“It will be interesting to see if the situation in China escalates and has an impact in a lot of areas – not the least the metals markets,” the producer source added.
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