NPI prices rose amid increased spot goods transactions
As of last Friday, the average price of 8-12% high-grade NPI was 955 yuan/mtu (ex-factory, including tax), up 19.5 yuan/mtu WoW. At the
beginning of last week, the RKAB incident escalated, and market sentiment regarding the shortage of NPI raw materials intensified.
Additionally, there were expectations of reduced production of NPI both domestically and internationally in February, leading to a tight supply. As a result, traders and domestic NPI plants significantly raised their offers, accompanied by reluctance to sell. From the demand perspective, the reduction in production at Indonesian NPI smelters has led to a decrease in the amount of Indonesian NPI flowing back into the domestic market. As a result, some steel mills have engaged in essential procurement last week. Despite the current off-season in the stainless steel industry, there has been a warming trend in the spot NPI market. Looking ahead, the approval process for RKAB noticeably accelerated, easing supply concerns. If demand remains weak, it is expected to weaken support for NPI prices.
Weekly average discount of high-grade NPI widened 37.6 yuan/mtu to 394.3 yuan/mtu against refined nickel last week. Both NPI and pure nickel prices saw an increase last week, but the refined nickel prices rose significantly more than NPI. SHFE nickel price surged. Despite the lack of improvement in downstream demand for pure nickel, there was still a significant increase in prices last week, driven by the RKAB event. However, with the accelerated approval process for RKAB, it is anticipated that nickel prices will quickly decline. The demand for NPI is weak, and prices are expected to decline gradually, albeit at a slower pace than pure nickel. In summary, the price difference between the two is expected to narrow this week.
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