Chinese Shutdowns Should Not Affect Nickel Pig-Iron Prices

After the fallout from the Chinese documentary “Under the Dome,” many nickel pig-iron producers are under pressure to clean up their act or shut down.

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Could nickel prices get a boost from the most recent closures at NPI producers in Linyi City, Shandong Province, China?

“The closures will not boost nickel price,” an analyst told CS.com.cn, as cited in Shanghai Metal Market, citing high LME nickel inventories, tumbling nickel prices, and a strong dollar.

Supply of low-grade NPI is also sufficient, the analyst told the website.

Linyi is a major producing region of low-grade NPI in China, with output accounting for 75% of China’s total.

The Indian nickel cash price closed up Thursday, March 5 at INR 884.90 ($14.20) per kilogram, halting two days of weakening prices with a 2.6% shift. Following a two-day drop, the nickel spot price increased by 1.8% on the LME to $13,825 per metric ton. Following a 1.5% rise yesterday, the nickel 3-month price closed on the LME at $13,875 per metric ton.

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Chinese stainless steel closed mixed yesterday. The price of Chinese ferro-chrome saw little movement at CNY 10,950 ($1,746) per metric ton. The price of Chinese ferro-moly saw essentially no change for the fifth day in a row, remaining around CNY 82,000 ($13,071) per metric ton.

The price of Chinese primary nickel rose 2.0% to CNY 104,500 ($16,658) per metric ton after a two-day drop. For the fifth day in a row, the Allegheny Ludlum 316 stainless surcharge remained essentially flat at $0.87 per pound. The price of Chinese 316 stainless coil was unchanged at CNY 23,700 ($3,778) per metric ton. The price of Chinese 304 stainless coil remained essentially flat at CNY 16,700 ($2,662) per metric ton. For the fifth consecutive day, the price of Chinese 316 stainless steel scrap held flat at CNY 13,050 ($2,080) per metric ton.

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