2016 Jinchuan Nickel pricing model may change

Abstract Mr. Bao Xingwang, deputy general manager of Jinchuan Group Marketing Company, said that the pricing model of Jinchuan Nickel will change in 2016. The model of “nickel price + liters premium” is used like copper, or it will become the main pricing model for domestic nickel enterprises in the future. Bao Xingwang refers to...
Mr. Bao Xingwang, deputy general manager of Jinchuan Group Marketing Company, said that the pricing model of Jinchuan Nickel will change in 2016. The model of “nickel price + liters premium” is used like copper, or it will become the main pricing model for domestic nickel enterprises in the future.

Bao Xingwang pointed out that the listing of nickel in Shanghai will inevitably change the domestic pricing model, including the influence of Jinchuan nickel price.

Although China's nickel production is not the largest in the world, as the world's largest nickel consumer, and a large number of stainless steel companies' enthusiasm for nickel futures, the traditional LME-led pricing model will gradually shift to the upward stage, leading domestic pricing. The right will also be strengthened.

Bao Xingwang also pointed out that the current model of domestic stainless steel monthly or weekly quotation is expected to change in the future.

Related reading: Strong import materials prompted China's nickel supply to increase in the coming months, but demand is weak

Hong Kong, June 2, industry sources said on Tuesday that strong imports may prompt China's nickel supply to increase in the coming months, but demand from stainless steel plants is weak due to slowing economic growth.

According to sources, this may weigh on prices and force some high-cost producers to cut output.

China's imports of refined nickel and alloys in April were the highest since January 2013, influenced by the spread between the London Metal Exchange (LME) and China.

China's imports of iron-nickel alloys hit a record high in April.

According to a senior analyst at Beijing Antaike Information Development Co., Ltd., the inflow is expected to increase further due to the increase in production of a large Chinese project in Myanmar due to the implementation of the Chinese project in Indonesia.

The analyst expects that the import of iron-nickel alloys from Indonesia projects in 2015 may reach 270,000 tons, and the import volume from the Myanmar project is expected to be 110,000 tons.

In 2014, China imported 7,154 tons of iron-nickel alloys from Indonesia and 58,674 tons of iron-nickel alloys imported from Myanmar.

Market sources said that China’s nickel demand has been sluggish this year, as economic growth has slowed.

A sales manager at a refined nickel producer said: "Spot nickel is difficult to sell."

According to sources, the EU’s demand for anti-dumping tariffs on Chinese stainless steel has also fallen, suppressing exports.

According to industry data, China's stainless steel production in the first quarter of 2015 decreased by 1.4% from the same period of the previous year to 5 million tons, and the export volume decreased by 1.7%.

Due to weak demand, Antaike has lowered its estimate of China's 2015 nickel consumption from the estimated 10.16 million tons in December to 960,000 tons. However, the new estimate is still up 2.1% from the same period last year.

China's spot nickel prices have fallen nearly 10% this year, about 98,000 yuan per ton on Tuesday.

A manager of a nickel-based pig producer in China said that for many companies, nickel pig iron prices have fallen to production costs. “If the price is below 960 yuan, many Chinese nickel pig iron producers will have to close.”

According to traders, spot nickel pig iron with a nickel content of 4%-15% is quoted at around 940-960 yuan/nickel on Tuesday and 1,010-1,030 at the end of March.

 

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