The nickel supply chain is witnessing a striking divergence among its various product forms. On August 26th, the average spot price for 1# electrolytic nickel in the Yangtze region reached 130,200 yuan per tonne, marking an increase of 500 yuan from the previous day, while electrolytic nickel plate averaged 130,800 yuan per tonne, up 450 yuan, signaling a robust performance in the refined nickel segment.
In stark contrast, nickel sulfate remained unchanged at 32,900 yuan per tonne, and nickel chloride held firm at 39,300 yuan per tonne, with the nickel salt segment stuck in a sideways pattern. The contrasting temperatures across the production chain vividly illustrate the two-track divergence currently shaping the nickel market.
Refined nickel and nickel salts originate from the same base metal yet took opposing paths on the same trading day, a divergence that often carries more analytical weight than a simple one-directional price move. The root cause of this split lies in the mismatch between supply and demand dynamics. On the supply side, output from nickel pig iron and high-grade matte continues to expand steadily, and the conversion pathway from intermediate products to both refined nickel and nickel salts remains unobstructed, keeping nickel salt supply comfortable and depriving nickel sulfate of upward momentum.
Demand, however, paints a dimmer picture. Stainless steel, the primary consumer of nickel, shows no substantial growth in production scheduling or new orders, while the new energy sector also remains in a subdued, stable state, with power battery and cathode material producers relying primarily on long-term contracts rather than spot purchases. While refined nickel strengthens on the back of supportive trading sentiment and restocking demand, nickel salts remain static due to lackluster end-user orders, steadily widening the price gap between the two forms.
The Shanghai nickel 2610 futures contract, trading at 129,640 yuan per tonne with a marginal decline of 20 yuan from the previous settlement, further confirms the cautious stance of the futures market toward the apparent strength in refined nickel spot prices. Examining the price transmission chain, the failure of refined nickel's strength to spill over into nickel salts reveals that ample intermediate supplies are severing the upward pricing linkage across the supply chain. Nickel pig iron quotes fluctuate in line with stainless steel margins, while high-grade matte continues to replenish the refining segment, with supply expansion persistently outpacing demand recovery—this is the fundamental reason why nickel sulfate and nickel chloride remain frozen in place.
The two-track divergence reflects the prolonged process of supply-demand rebalancing in the nickel market. The ongoing release of nickel pig iron and high-grade matte continues to accumulate supply pressure, while neither the stainless steel nor the new energy demand pillars have yet provided signals strong enough to absorb the incremental output, making it difficult for the refined nickel-nickel salt gap to converge quickly. Going forward, market participants should monitor stainless steel mill production adjustments, new energy subsidy policies and installation pace, as well as changes in Indonesia's nickel product export policies—only when genuine recovery emerges across both demand pillars can the two tracks of nickel prices potentially realign.
On the Indonesian front, nickel product export policies and mining quotas remain the most significant long-term supply variables, and any marginal tightening could reshape the current two-track landscape. Meanwhile, the pace of destocking in domestic stainless steel social inventories will serve as the litmus test for the true strength of both demand pillars. As incremental supplies of nickel pig iron and high-grade matte continue to pour in while end-user orders remain anchored to long-term agreements, the divergence between refined nickel and nickel salts may well persist for several more trading sessions.