Nickel in China

摘要

The Chinese stainless market was characterised by oversupply and weak demand during the latter part of 2012. This is exemplified by Chinese melted output, up 9.3% for the year, appearing relatively unaffected by the slowing of Chinese IP growth during the second half of 2012. Distributor prices for cold rolled 304 CR 2mm stainless remained below Rmbl8,000/t in H2 and dropped under Rmb17,000/t in November before recovering to Rmb17,000/t in December. September's rally in the nickel price and the brief bout of restocking that it brought with it petered out in October. The gentle recovery in price that has been seen since then does not appear to have brought with it any restocking activity, with inventory at the Wuxi and Foshan markets falling in the first half of January 2013. This contrasts with the previous two Januarys, where speculative restocking pushed stocks up sharply. We believe that the absence of this restocking thus far is due to distributors waiting for Chinese New Year, which falls relatively late (mid-February) this year. We expect restocking to commence following this, but to be less pronounced than in prior years.