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China Nickel Market - Weakening
= Nickel metal price has been dragging down; ferronickel price also weakening despite producers' resistance =
Reflecting the LME fluctuations since January, prices of nickel metal and ferronickel in China went up in steps during January/February, but started decline in March partly due to the self-adjustment of the market. The resistance of ferronickel producers to maintain the price does not seem to have been very successful.

Price changes of ferronickel (Ni: 10 -15%) in the domestic markets (Inner Mongolia and Hunan) have been, <> December 23: RMB1,240 - 1,180/ton, <> January 10: RMB1,260 - 1,290/ton, <> January 30: RMB1,280 - 1,310/ton, <> February 10: RMB1,380 -,1430/ton, <> February 20: RMB1,390 - 1,430/ton, <> March 1: RMB1,380 - 1,430/ton and <> March 16: RMB1,370 - 1,410/ton. All prices are based on delivered to user's plant yard and tax paid.

Price changes of electrolytic nickel metal (Jinchuan 1#, Ni>99%) in the domestic market (Tianjin) have been, <> December 29: RMB128,200/ton, <> January 9: RMB132,000/ton, <> January 30: RMB148,500/ton, <> February 10: RMB147,000/ton, <> February 20: RMB140,000/ton, <> March 1: RMB138,500/ton, and <> March 16: RMB137,800/ton. All prices are based on delivered to user's plant yard and tax paid.

Production at the stainless steel mills in China has been low because of the lower demand from construction sectors, making the demand for ferronickel also lower. Especially nickel-pig-iron consumption was first trimmed of which nickel unit cost was less competitive than the ferronickel of regular grade, as LME nickel price declined.

In September and October last year, it was reported that more producers of ferronickel, mostly of nickel-pig-iron, in Inner Mongolia were obliged to curtail or cut back production to avoid operations in red and output of ferronickel from the province was substantially reduced. When LME price rebounded in February 2012, ferronickel production was increased as some of ferroalloy producers converted their furnaces to produce ferronickel, or some of the ferronickel producers resumed operation at the idled furnaces. This indicates that medium/small-sized producers are basically flexible in coping with changes in the market for profitable operation.

For reference, Jinchuan Group, the leading producer of nickel in China set a production target in 2012 at 135,000 tons, a little up from 2011's 130,000 tons. Target figures of other products are, <> copper: 600,000 tons (cf. 520,000 tons in 2011), <> cobalt: 8,000 tons (6,675 tons in 2011), <> platinum group metals (PGI): 2.050 tons (2.504 tons in 2011), <> gold: 8.000 tons (3.516 tons in 2011), <> silver: 300 tons (220 tons in 2011), <> selenium: 60 tons (70 tons in 2011), <> non-ferrous metal intermediate products: 150,000 tons (140,000 tons in 2011), <> chemical products: 2,400,000 tons (2,460,000 tons in 2011).
last modified : Mon 26 Mar, 2012 [11:40]
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