The Main Factor Affecting Global Nickel Prices In 2020 Is Indonesia's Supply Changes
In 2020, the core variable of global nickel supply lies in Indonesia, which includes not only the decrease in the supply of Indonesian nickel ore, but also the increase in the supply of Indonesian NPI and Indonesian wet-process capacity.
The most important factor influencing the global nickel price in 2020 is the change in Indonesian supply, followed by the Philippine nickel ore policy and China's new energy vehicle policy.
Global primary nickel supply changes mainly include NPI production capacity, wet production capacity, re-production capacity, traditional nickel production plans, etc. The additional production capacity of nickel sulfate beyond wet production capacity is processing capacity, which does not belong to the primary nickel category, so it is not calculated . Except for nickel companies with production capacity that has been discontinued and resumed, the production plans of other traditional nickel companies are relatively stable. Therefore, we mainly analyze NPI capacity, wet process capacity and resumed capacity.
The Indonesian NPI is the core engine that drives the growth of global primary nickel supply. It is the largest increase in the global primary nickel supply in the next few years. In recent years, the NPI nickel content of the RKEF process put into operation in Indonesia is generally above 12%, and even some NPI The nickel content can reach more than 13.5%. If the nickel-iron content reaches 12% to 13%, the pure nickel required for stainless steel production will be minimal.
Therefore, if Indonesian NPI is used as the main raw material for stainless steel production in China in the future, the demand for refined nickel in the stainless steel field will be obvious. Down. However, China's NPI is still the main raw material of 300 series stainless steel. The nickel content of China's NPI is only 9% ~ 9.5%. Indonesia's ban on mining may cause China's NPI nickel content to decline again in 2020.
The 2019 to 2021 Indonesian NPI new capacity is mainly divided into five parts, namely Tsingshan Indonesia, Delong Indonesia, Jinchuan WP, Weda Bay fire project and other enterprises. Among them, the Jinchuan WP project has been fully put into operation in 2019. In 2020, the newly-added NPI production capacity in Indonesia is mainly the Weda Bay fire method project and Delong Indonesia project in Tsingshan.
After Indonesia banned the export of nickel ore in 2020, no country's nickel ore supply was sufficient to make up for this short-term. Therefore, in 2020, nickel iron ore companies in China will inevitably suffer losses and reduce production due to insufficient nickel ore.
Indonesia's ban on mining may lead to a decline in the supply of about 25 million wet tons of nickel ore (estimated after the removal of import rush factors). With the high profit of nickel mines, it is optimistic that other countries may increase 5 million wet tons. According to the calculation of 1.65% nickel content, the water content is 67%, and the global nickel ore supply may still have a reduction of 220,000 nickel tons in 2020.
Affected by China ’s nickel ore inventory, there is a buffer period for China ’s NPI production to shrink in 2020. It is estimated that China's NPI production will be reduced by 106,000 nickel tons in 2020, and it will continue to reduce output by 60,000 nickel tons in 2021.
Indonesia and the Philippines have not much nickel reserves in the world, ranking sixth and seventh, but the nickel ore supply in these two countries has a huge impact on nickel prices, mainly because China is the world ’s largest producer of primary nickel. It is also the world ’s largest importer of nickel ore. Indonesia and the Philippines are located close to China. The nickel ore freight is relatively low. Indonesia and the Philippines are dominated by laterite nickel ore and the cost of surface mining is low. Therefore, Indonesia and the Philippines have become China's main nickel mine importing country.
Nickel ore resources in other countries are very rich. China's imports of nickel ore from other countries are relatively small, mainly due to the impact of sea freight and export country policies. If the price of nickel ore remains high, the supply gap will gradually narrow under the stimulation of high profits .