Singapore 22/06/2016 - China’s refined nickel and nickel alloy imports rose 60 percent year-on-year but fell 23.4 percent month-on-month to 37,559 tonnes in May, according to latest data from the Chinese customs.
The month-on-month decline is mainly due to a closed import arbitrage, said market participants.
Imports totalled 195,158 tonnes in January-May, a near three-fold increase from the same period last year.
Other than earlier arbitrage opportunities between Shanghai and London markets, nickel imports had risen so far this year due to nickel financing deals, sources said.
The bulk of imports came from Russia, which accounted for 63 percent and 70 percent of total imports in May and January-May respectively.
China’s ferronickel imports rose 43.4 percent year-on-year to 88,250 tonnes in May, taking year-to-date imports to 382,945 tonnes. This is a 48.5-percent increase from the same period last year.
Ferronickel imports have remained strong due to production cuts among Chinese nickel and nickel pig iron (NPI) producers, and ramp-up of NPI projects in Indonesia, said industry watchers.
Ferronickel imports from Indonesia into China jumped nearly five-fold year-on-year to 255,977 tonnes in the first five months of the year.
Market participants have also reported of strong demand for ferronickel and nickel metal amid prolonged output cuts by Chinese NPI producers and better-than-expected stainless steel production in China.
Meanwhile China’s nickel ore and concentrate imports fell 5.1 percent year-on-year but more than doubled month-on-month to 3.08 million tonnes in May. Of the May imports, three million tonnes were from the Philippines, which was a 6.8-percent decline from the same month last year.
Total nickel ore and concentrate imports fell 25.9 percent year-on-year to 7.61 million tonnes in January-May. Those from the Philippines were down 27.5 percent year-on-year to 7.16 million tonnes during the period.
The decrease in imports so far this year reflects slower demand from Chinese NPI producers, heavy rains in parts of the Philippines which had hampered shipments, and possible production cuts among Philippine miners, sources said.
Exports from the Philippines have however increased on a month-on-month basis as shipments resume with the end of monsoon season in the region, they noted.
The Philippine Nickel Miners Association, which accounts for 60 percent of domestic nickel ore production, had agreed earlier this year to reduce ore output by as much as 20 percent over 2015 volumes.
But analysts said it remains to be seen if the pledge will be adhered for the rest of the year.