Nickel sulfate and ternary precursors to rise slightly after the National Day holiday

Nickel sulfate:

Nickel sulfate prices continued upward trend throughout the thirdquarter starting from late July. According to Mysteel survey, as of September25, the midpoint price for battery-grade nickel sulfate crystal stood at Yuan27,950/tonne, up Yuan 400/tonne from August. The midpoint price forbattery-grade nickel sulfate liquid was Yuan 27,750/tonne, an increase of Yuan900/tonne from August, while the midpoint price for electroplating-grade nickelsulfate reached Yuan 28,950/tonne, rising by Yuan 700/tonne compared to August.

On the fundamentals,entering September, nickel sulfate producers that had previously halted orreduced production gradually resumed capacity, indicating a potential supplyincrease in China for the fourth quarter. Mysteel survey noted that following the resumption of production linesat a leading nickel salt plant in North China in October, nickel sulfate supplyis expected to grow. In August 2025, China's nickelsulfate production stood at 206,000 tonnes in August, or 45,300 tonnes in Ni.content, up 6.37% month on month (MoM). Production for September is forecast at47,100 tonnes in Ni. content, up 3.87% MoM.

Ternaryprecursor production saw a significant increase in August and September.Sustained demand for nickel sulfate led ternary precursor enterprises tocontinue inquiry-based purchases and transactions for pre-holiday stockingahead of the National Day holiday. Accordingto Mysteel, some nickel salt plants still had limited inventories available forspot trading. While making weekly inquiries and transactions, ternary precursorcompanies also factored in considerations such as nickel sulfate quality,delivery methods, and transportation distance. Spot supply of nickel sulfate inthe merchant market remained tight. Furthermore, to fulfill existing long-termcontracts, some salt plants resorted to external procurement of nickel sulfateto supplement their own shortfalls. These combined demand factors contributedsignificantly to the price increase. Mysteel surveys indicated transactionswere concluded around Yuan 28,000/tonne, with prices projected to have afurther upside of Yuan 400-500/tonne post-holiday. In the short term, demandfrom the new energy vehicle industry is expected to maintain its momentum,remaining a key force supporting nickel sulfate market demand.

On the cost front,nickel sulfate prices recently remained elevated, pressured by high costs ofMHP, which in turn stemmed from persistently high nickel ore and sulfur prices.Increased stainless steel production in September and October boosteddemand for nickel pig iron (NPI), driving its price up. This prompted somehigh-grade nickel matte production lines to switch back to producing NPI,consequently limiting any potential supply increase from nickel matte.Supported by its own demand, nickel sulfate producers had to opt forhigh-priced MHP. Thus, with production costs providing strong support, nickel sulfate priceswere unlikely to follow a downward trend in October.

According to Mysteel,MHP supply is currently tight. Some traders have already completed orderbookings for October, while others hold limited MHP volumes, with some evenhaving no stock available. Looking ahead to the fourth quarter, factors such asseasonal demand weakness in the traditional off-season and the release ofnickel ore production from Indonesia may potentially push nickel prices lower.

 

China'snickel sulfate imports stood at 30,292.611 tonnes in August, up 78.87%month-on-month (MoM) and 32.17% year-on-year (YoY), based on data from theGeneral Administration of Customs of the People's Republic of China (GACC). From January to August, the total nickel sulfate importsreached 160,189.381 tonnes, up 7.21% year-on-year.

 

Source: Mysteel

 

China maintains a heavy reliance on imports of key nickel sulfateproduction raw materials, such as nickel ore and MHP. Despite continueddomestic capacity expansion, robust demand for nickel sulfate has resulted inpersistent supply tightness within China. Consequently, imports of nickelsulfate are expected to remain necessary during September-October to bridge thedemand gap. An increase in nickel sulfate imports is anticipated after theNational Day holiday period.

 

EnteringOctober, nickel sulfate market prices are expected to remain stable with apotential for increase, projected to trade within a range of Yuan 28,100-28,400/tonne. However, moving into November and December, expectations ofinventory accumulation for refined nickel coupled with the onset of the demandoff-season are likely to lead to weaker consumption. This is anticipated toshift the price center of gravity for nickel lower, prompting subsequentadjustments in nickel sulfate prices. It is noteworthy that the planneddiscontinuation of the purchase tax subsidy for new energy vehicles in 2026 isexpected to stimulate downstream demand earlier. Automakers mayaccelerate production before the end of 2025 to secure subsidy benefits.

 

Ternary precursors and ternary cathode materials: 

Entering September, prices for ternary precursors and ternary cathodematerials stabilized following previous increases. According to Mysteel, as ofSeptember 25, the midpoint price for 5-series ternary precursor was Yuan77,500/tonne, up Yuan 3,500/tonne from August. The 6-series midpoint price wasYuan 80,500/tonne, rising Yuan 3,000/tonne, while the 8-series midpoint pricereached Yuan 91,500/tonne, an increase of Yuan 2,000/tonne. For ternary cathodematerials, the 5-series midpoint price was Yuan 112,500/tonne (up Yuan5,000/tonne MoM), the 6-series was Yuan 147,500/tonne (up Yuan 5,000/tonne),and the 8-series was Yuan 140,000/tonne (also up Yuan 5,000/tonne).

 

Regarding cobalt salts, the Democratic Republic of Congo (DRC)announced last Saturday that its cobalt export ban will end on October 16,2025. Subsequently, all cobalt exports from the DRC will be subject to a quotapolicy until further notice. Currently, spot inventories of cobalt intermediateproducts in China are tight. Even after quotas are lifted in mid-October, thelong sea freight cycle means the tight supply situation domestically isunlikely to ease in the short term. Overall spot market prices in the fourthquarter are expected to be more prone to increases than decreases.

 

In the lithium salt sector, although companies indicated thatproduction resumptions were progressing smoothly, operations had not yetofficially restarted. With the National Day holiday approaching, downstreamplayers gradually commenced pre-holiday stocking, which, along with spot marketvolumes and prices, could provide support in the short term. Lookingahead, supply in the fourth quarter is highly likely to remain high, whiledemand faces seasonal pressure.

 

InSeptember, prices for nickel and cobalt salts increased significantly, drivingup the absolute cost and exacerbating cost pressures for ternary precursors. Coupled with robust downstream demand during the month, capacityutilization rates for ternary precursors improved. The transaction coefficientsfor spot nickel and cobalt purchases by some precursor manufacturers rose by1-2% to a range of 90-92% of the benchmark.