VINACHEM

China’s nickel sulfate prices have been consolidating within the range of 26,000-27,500 yuan ($3,653-3,863) per tonne in the past few weeks, with no signs of a clear direction, sources told Fastmarkets

Weekly assessment for nickel sulfate min 21%, max 22.5%; cobalt 10ppm max, exw China was 26,500-27,000 yuan ($3,723-3,794) per tonne on Friday August 23, narrowing upward by 500 yuan per tonne from 26,000-27,000 yuan per tonne on August 16.

Both the tightening supply of mixed hydroxide precipitate (MHP) and a firm MHP payable around 80% are providing support for the nickel sulfate market, a buyer of nickel sulfate said.

But slow demand from the downstream nickel-cobalt-manganese (NCM) cathode precursor sector “could add pressure to the price increase for nickel sulfate,” the buyer added.

Daily assessment for nickel mixed hydroxide precipitate payable indicator, % London Metal Exchange, cif China, Japan and South Korea stood at 78-80% on Friday, unchanged since August 19 but widening upward from 78-79% on August 1.

“A tightening supply of nickel MHP has led to nickel sulfate producers holding prices firm, considering low inventories and low operation rates around 30-40% for the salt production,” a trader said.

“We have heard offer prices for nickel MHP as high as 83-84% recently,” the trader added.

But slow demand from the downstream NCM battery sector continued to weigh on spot nickel sulfate prices, according to sources.

The market share of ternary cathode stayed low after the sharp decline in June, Fastmarkets understands.

A second trader of nickel sulfate reported a marginal increase in the market share but said that the growth is limited compared with the lithium iron phosphate (LFP) batteries in EVs.

“Currently, the share of NCM batteries in EVs could be around 26-28%, slightly up from 25-26% in June,” the second trader said.

Nickel market outlook for rest of year

According to the first trader, it is difficult to say how the market will develop in the rest of the year, given that downstream buyers are not in a hurry to restock nickel sulfate.

While the global nickel sulfate market experienced similarly slow liquidity in the past couple of weeks, the all-in price for the material increased on higher weekly average nickel cash prices on the LME.

Beginning in the week to Friday, Fastmarkets changed its assessment of nickel sulfate premium, cif Japan and Korea from a single price to a range.

The nickel sulfate premium, cif Japan and Korea at $1,000-2,000 per tonne on Friday, with the wide range reflecting the difference between feedstock sources and material compliant with the US Inflation Reduction Act (IRA).

On Friday, the all-in price was calculated at $3,869-4,091 per tonne, up by 4.75% from the previous assessment at $3,799 per tonne.

The calculated weekly average LME nickel cash price was up by 1.94% to $16,347.50 per tonne.

The upside for nickel could remain supported by a favorable macroeconomic environment in the short term, characterized by expanding global liquidity and increased risk-taking behavior, with higher expectations of an interest rate cut by the US Federal Reserve in September, according to Fastmarkets’ research analyst Andrew Cole. 

 – Source: Fast Markets –