[SMM Analysis: Indonesia's HPM New Policy Pushes Up Costs — How Will the High-Grade NPI Landscape Change?] Recently, affected by Indonesia's nickel ore quota and HPM benchmark price adjustments, high-grade NPI production costs have seen a rigid increase. Combined with supply-side increments falling short of expectations and continued inventory destocking, market prices have fluctuated upward... The following is SMM's detailed analysis:

The Nickel Pig Iron (NPI) market looks firm on the surface — but dig one layer deeper and two very different realities emerge for high-grade and low-grade material.

[SMM Daily Comment: Sharp Rise in Futures Widened Price Spread, Driving Some Traders to Actively Inquire About Purchases] April 14 — The SMM high-grade NPI upstream sentiment index was 2.84, up 0.06 MoM, and the high-grade NPI downstream sentiment index was 1.52, up 0.01 MoM.

[SMM Daily Comment: Actual Transaction Center Still Declining, Market Taking a Wait-and-See Approach amid Macro Disturbances] April 13 — The SMM high-grade NPI upstream sentiment factor was 2.78, up 0.04 MoM, and the high-grade NPI downstream sentiment factor was 1.51, up 0.03 MoM.

Nickel Ore " RKAB Approval Delays and Policy Shifts Expected to Drive Nickel Ore Prices Higher" This week, the price of domestic nickel ore in Indonesia has increased. In the first half of April, the Indonesian nickel ore benchmark price (HPM) was set at $17,093 per dry metric ton, a month-on-month decrease of 1.37%. According to SMM's Indonesian nickel ore premium data, the average premiums for laterite nickel ore with grades of 1.4%, 1.5%, and 1.6% were reported at $37.5, $41.5, and $42 per wet metric ton respectively. Among them, the domestic arrival price for 1.6% grade nickel ore was $69.2–75.2 per wet metric ton. The dual strengthening of premiums this month reflects the release of smelters' restocking demand and pessimistic expectations regarding the reduction of RKAB quotas. Meanwhile, the delivery price of 1.2% grade hydrometallurgical ore has also increased to $27–30 per wet metric ton. Pyrometallurgical Ore: From the perspective of supply and demand fundamentals, as of April 10, 2026, according to the forecast of the Indonesian Meteorological Agency BMKG, core nickel ore producing regions such as Morowali, Kolaka, and Halmahera will face continuous moderate to heavy rain and thunderstorms this week, with humidity expected to approach the saturation level of 99%. Under the combined effect of active atmospheric waves and thick clouds, this extremely humid and changeable weather is expected to continue to constrain the mining efficiency of open-pit mines, slow down logistics and transportation, and further increase the operational difficulty of high-moisture management during the shipping process of laterite nickel ore. The current market is facing an obvious trend of grade decline. Although some NPI smelters have begun to accept ore with a grade of 1.45% and below, pyrometallurgical ore remains tight in April. Currently, the Ministry of Energy and Mineral Resources (ESDM) of Indonesia announced to the media on April 6, 2026, that approximately 190 million to 200 million tons of nickel production quotas in the 2026 Work Plan and Budget (RKAB) have been approved. At present, some mining enterprises have received preliminary notices from the government regarding the latest quota indicators, but most enterprises have yet to obtain the final approved data. The market generally expects that the final approved amount of the 2026 RKAB will be officially finalized in the second week of April. In terms of demand, due to the resource uncertainty faced by some smelters in Indonesia and the difficulty in obtaining high-grade nickel ore, prices have shown strong performance. To ensure raw material supply, some smelters have even increased trade bonuses. Hydrometallurgical Ore Additionally, there have been some transactions of low-grade saprolite ore in the market, with its fixed price relatively lower than that of high-grade ore. Following the significant increase in the price of pyrometallurgical ore, the price of limonite has also risen, aiming to further stimulate the sales enthusiasm of mines. In terms of shipping costs, affected by the increase in domestic fuel prices in Indonesia, inter-island logistics costs have shown an upward trend. It is estimated that as the RKAB quotas of mines are gradually issued in the future, freight demand will further increase, and domestic shipping costs may face a new round of upward pressure at that time. On the policy side, the Ministry of Energy and Mineral Resources (ESDM) of Indonesia is finalizing the review of the calculation formula for the Mineral Reference Price (HPM) of nickel ore and plans to officially implement it within April 2026. Tri Winarno, the Director General of the Mineral and Coal Directorate, pointed out that the current HPM can no longer accurately reflect the current market price, especially failing to cover the "market premium" actually paid by smelters. Although the regulatory details for specific products such as NPI and MHP still await finalization by inter-ministerial bodies, judging from the current policy trend, this may indicate that the era of tax-free exports of nickel intermediate products from Indonesia is coming to an end. Looking ahead to the after-market, the continuous tightening of Indonesia's policies is expected to open up further upward space for nickel ore prices and have a profound impact on the cost structure of the global nickel supply chain. Overall, affected by potential major policy adjustments in Indonesia in the future, market uncertainty has increased, supporting the continuous volatile strengthening of Indonesia's nickel ore prices. Nickel Pig Iron "High-Grade NPI Under Short-Term Pressure Amid Upstream-Downstream Tug-of-War " The average price of SMM 10-12% NPI average price dropped by RMB 2.25 per nickel unit week-on-week to RMB 1080.25 per nickel unit (ex-works, tax included), while the Indonesia NPI FOB index decreased by USD 0.43 USD per nickel unit to an average of USD 137.01 per nickel unit. High-grade NPI (Nickel Pig Iron) market conditions generally remained steady. As transaction levels stabilized, the market entered a period of tug-of-war between upstream and downstream players, leaving prices under short-term pressure. From the supply side, the center of upstream quotes continued to drift slightly lower. The market has seen a notable increase in the availability of stainless steel scrap. Under the dual weight of weak terminal demand and the cost-effectiveness of scrap, upstream quotes for high-grade NPI are increasingly showing signs of softening. In Indonesia, domestic nickel ore prices have risen, and the market is grappling with a clear decline in ore grades; consequently, the supply of saprolite for pyrometallurgical processing remains tight for April. In the stainless steel spot market, social inventory levels remain at absolute highs. Despite significant pressure to move shipments, steel mills are maintaining high production rates. While there is some support from the cost side, the mills themselves are facing heavy internal cost pressures. Furthermore, with the economic advantage of stainless steel scrap becoming more prominent, mills have low tolerance for high-priced NPI and are maintaining a cautious procurement stance. In summary, NPI prices remain locked in a short-term stalemate between upstream and downstream. Influenced by competition from scrap and limited buying interest from stainless steel mills, prices continue to face overhead pressure.

Stainless steel spot prices rose this week, but production costs pulled back somewhat, narrowing the degree of cost-price inversion for stainless steel mills. Taking 304 cold-rolled products as an example, based on same-day raw material prices, the full cost profit margin was -0.36% this week; calculated using inventory raw material costs, the margin was -0.83%. Nickel-based raw material costs: high-grade NPI prices remained in the doldrums this week. Stainless steel enterprises continued their earlier cautious purchasing strategy, and recent high-grade NPI transactions remained sluggish. Although high-grade NPI still had cost support, offer prices continued to edge lower under shipment pressure. As of this Friday, high-grade NPI with a grade of 10-12% fell 1.5 yuan per nickel unit, closing at 1,080 yuan/nickel unit. Stainless steel scrap market: stainless steel scrap prices remained generally stable this week. Although SS futures performed strongly, the transmission effect on stainless steel spot prices was limited, and scrap prices saw no significant boost. On the alternative raw material front, high-grade NPI was weak and ferrochrome prices declined, providing limited support for stainless steel scrap. The cost-effectiveness advantage of stainless steel scrap still existed, and rising stainless steel finished product prices also provided some support. However, strong cost pressure on steel mills, their strong desire to bargain down prices, and weak market demand collectively constrained price increases. Prices are expected to remain stable in the short term. As of this Friday, 304 off-cuts prices in Shanghai remained stable, with the latest quote at approximately 10,150 yuan/mt. Chromium-based raw material costs: high-carbon ferrochrome prices continued their downward trend this week. Although April stainless steel planned production remained at a high level, insufficient end-use demand support made it difficult for stainless steel prices to rise, which in turn weighed on market expectations. In addition, the production cut plans previously set by ferrochrome producers have had limited effect so far, and ferrochrome supply remained at a high level. Recent market transactions were overall sluggish, and producers had to slightly lower their offer prices under shipment pressure. As of this Friday, high-carbon ferrochrome prices in Inner Mongolia fell 75 yuan/mt (50% metal content) WoW, closing at 8,550 yuan/mt (50% metal content).

This week, 304 stainless steel scrap off-cuts prices in east China remained stable at 10,100-10,200 yuan/mt; prices for the same grade of stainless steel scrap off-cuts in Foshan pulled back slightly, with a price range of 9,700-10,000 yuan/mt. From the raw material production cost perspective, the current cost of producing stainless steel entirely from stainless steel scrap was approximately 14,218.64 yuan/mt, while the production cost using entirely high-grade NPI was 14,706.33 yuan/mt. This week, stainless steel scrap prices were largely stable, with no clear one-directional trend. Although the US-Iran conflict eased this week with both sides reaching a two-week ceasefire agreement, the positive news drove SS futures higher, but the spot stainless steel finished product market saw limited impact, with only a slight increase that failed to form effective transmission and did not notably boost stainless steel scrap prices. Alternative furnace charge performance diverged — high-grade NPI prices remained in the doldrums this week, while high-carbon ferrochrome prices stayed flat, with limited overall impact on stainless steel scrap prices. The cost advantage of stainless steel scrap over high-grade NPI remained quite evident, and the strengthening of stainless steel finished product prices provided some support for stainless steel scrap prices, preventing downward fluctuations. However, constraining factors were equally significant — steel mills themselves faced considerable cost pressure and continued to show poor acceptance of high-priced raw materials, with a clear desire to bargain down prices during procurement; meanwhile, overall purchase demand for stainless steel scrap was weak, compounded by the generally weak trend of other alternative raw materials, further limiting the upside room for stainless steel scrap prices and making it difficult to break out of the stable pattern. Overall, the stainless steel scrap market this week exhibited a pattern of "limited support, notable constraints, and stable prices," with supporting and constraining factors counterbalancing each other, making it difficult to drive any significant price change. Stainless steel scrap prices are expected to remain largely stable in the near term.

[SMM Stainless Steel Daily Review] SS Futures Strengthened, Stainless Steel Spot Market Ran Steadily SMM, April 10: SS futures strengthened and rose. SS futures extended the mid-week rally and further explored upward. As of the morning close, the most-traded contract was reported at 14,495 yuan/mt. Spot market side, despite SS futures exploring higher, the spot market remained stable. In addition, a major stainless steel producer released its guidance price today, which held steady MoM. Although intraday inquiry activity picked up somewhat and some low-priced resources decreased, actual transactions remained limited, and upward momentum for prices was insufficient. The most-traded SS futures contract strengthened and rose. At 10:15 AM, SS2605 was reported at 14,470 yuan/mt, up 180 yuan/mt from the previous trading day. Spot premiums for 304/2B in the Wuxi area ranged from 50-250 yuan/mt. In the spot market, the average price of cold-rolled 201/2B coils in Wuxi held steady; for cold-rolled trimmed-edge 304/2B coils, the Wuxi average price rose by 50 yuan/mt while the Foshan average price held steady; cold-rolled 316L/2B coils in the Wuxi area held steady; for hot-rolled 316L/NO.1 coils, Wuxi quotes remained flat; cold-rolled 430/2B coils in both Wuxi and Foshan held steady. The stainless steel market was currently in the traditional peak season of "Golden March and Silver April." In the short term, macro tailwinds helped restore confidence, and spot inquiry activity picked up. However, cautious sentiment among downstream end-users persisted, with procurement still driven by rigid demand. Acceptance of high-priced resources remained poor, and transactions relied on low-priced resources, with no significant volume increase overall. Futures side, the US-Iran conflict de-escalated this week, with both sides reaching a two-week ceasefire agreement and initiating negotiations. Macro...

[SMM Daily Comment: Weak End-User Demand Exerted Pressure, High-Grade NPI Prices Edged Down] On April 10, SMM's upstream sentiment index for high-grade NPI was 2.74, up 0.03 MoM, while the downstream sentiment index for high-grade NPI was 1.48, flat MoM.

[SMM Daily Comment: Sluggish Market with Scarce Transactions, High-Grade NPI Prices Remained Flat] On April 9, the SMM upstream sentiment index for high-grade NPI was 2.71, down 0.03 MoM, and the downstream sentiment index for high-grade NPI was 1.48, down 0.01 MoM.