China's refined nickel imports stood at 9,683.721 tonnes in October, up 73.30% month on month (MoM), based on data from the General Administration of Customs of the People's Republic of China (GACC).
Source: GACC
The increase was primarily contributed by imports from Russia, which showed a monthly surge of 169.29% at 7,072.687 tonnes in the month amidst active exports of domestic electrowinning nickel that led to a supply shortage of spots in the domestic demand.
Source: GACC
According to GACC, China's refined nickel exports jumped 29.85% MoM at 13,381.429 tonnes, and the exports under the trade mode of processing with imported materials hit a new historical high. Specially, companies like Huayou Cobalt, CNGR, and GEM are able to re-export the finished products produced with imported materials free of duty. More importantly, delivering electrowinning nickel to LME warehouses were more profitable than delivering to SHFE warehouses or domestic spot market, in addition to the continuous ramp-up of domestic manufacturers, though the export margins were palpably lower than those in May and June 2024.
Source: GACC
Source: Mysteel OilChem
Looking ahead, domestic electrowinning nickel producers will likely prioritize maintaining profits as the nickel price has been hovering around the break-even point of refined nickel produced with high-grade nickel matte via integrated production. In other words, the domestic producers are estimated to keep delivering their nickel products to LME warehouses, leaving a void in the domestic market to be fulfilled with refined nickel imported from Russia, especially when the LME nickel inventory is still far away from the historical high.
Written by Aggie Hu, huchenying@mysteel.com
