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China refined nickel imports drop in Sept.

Keywords: Tags  China, imports, nickel, refined, ore, Rey Mashayekhi

NEW YORK — Chinese refined nickel imports fell to a three-month low in September, offset by continually rising nickel ore imports ahead of next year’s ban of Indonesian raw materials, according to Chinese customs data.

Refined nickel imports to China totaled 11,967 tonnes in September, down 16.3 percent from the previous month and a 12.7-percent decrease from the same period last year (, Oct. 21) . That total represents the second-lowest amount of refined material imported in 2013.

Imports of nickel ore, meanwhile, broke 6 million tonnes for the third time this year, reaching 6.7 million tonnes—a 27-percent increase from the previous month and up 7.2 percent year on year.

Analysts said the figures reflect increased internal production of nickel units in China, in both nickel pig iron (NPI) ore imported from Indonesia and domestic production of refined nickel cathodes.

"There’s a lot of nickel pig iron capacity that has come on stream this year and is ramping up," Metal Bulletin Research’s analyst Andy Cole told AMM. "All these furnaces need ore and this is a time of year when production is expected to increase as we’ve come out of the holiday period; there’s a push to meet annual targets by the year-end and demand is better from stainless steel mills."

The marked increase in nickel ore imports could also indicate stockpiling ahead of Indonesia’s ore export ban, expected to take effect next year.

"There’s a degree of stockpiling going on in case supply from Indonesia gets constrained next year, either by way of the proposed ban or by way of higher taxes and quotas," Cole said.

Nickel producers worldwide have felt the impact of China’s NPI boom, which analysts have attributed as a key factor behind the decline in nickel prices this year.

Citi Research commodities analyst David Wilson said he was "not convinced" that China’s NPI boom would maintain, adding that the longer-term outlook for global nickel producers is "looking more positive because NPI production can’t (continue to) expand at the rate it has."

Regardless, Wilson said stockpiled inventories of nickel ore in China means that the impact of any restrictions on Indonesia ore exports on the global nickel market would not be felt immediately.

"There’s about six months worth of inventory. You wouldn’t see an immediate stop in (NPI) production because of the restrictions," Wilson said.

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