PaCIFic Metals, a Japanese ferronickel producer, reported higher shipments of ferronickel in the April-June quarter, pointing to a recovery in stainless steel production at home and abroad.
Pacific Metals is Japan's largest producer of ferronickel. The company has raised shipments of ferronickel for the april-September period to 13,047 tonnes, up from a previous forecast of 11,600 tonnes. The company said domestic and export demand was strong in the April-June period as the global economy recovered from the COVID-19 pandemic and stainless steel production increased. The new april-September sales target is 35 per cent higher than the same period last year.
The company added that there is still uncertainty in stainless steel production due to the outbreak, while nickel-iron demand continues to be affected by overseas stainless steel mills shifting to more competitively priced nickel pig iron.
Pacific Metals now aims to increase its nickel-in-iron production to 25,010 tonnes in the financial year from April 2021 to March 2022, up 36 per cent year on year. The company had previously planned to produce 24,822 tonnes of ferronickel this fiscal year.
Japanese ferronickel producers had earlier forecast an increase in production in 2021-22. But ferronickel exports remained sluggish in the first six months of the year from a year earlier, even as shipments to China and India picked up to partly offset weak demand from stainless steel mills in South Korea and Taiwan.
So far this year, China's demand for iron and nickel imports has remained strong. Japan's iron-nickel deliveries to China in June rose 64% from a year earlier to 6,369 tons, accounting for nearly 60% of the country's total iron-nickel exports for the month.
China imported 1.33 million tons of ferronickel from January to May, up 26.4 percent year on year, customs data showed.
Sumitomo Metals Mining Co., Japan's second-largest nickel-iron producer, expects its nickel-iron production to rise 22% from a year earlier to 3,300 tons in the July-September period. But ferronickel sales are expected to fall 6% year-on-year to 3,300 tonnes in the current quarter.
Nippon Yakin Kogyo, a Japanese stainless steel producer, also reported a gradual recovery in the stainless steel industry, supported by demand for manufacturing machinery. The pace of recovery is accelerating, the company said, with demand for stainless steel expected to return to pre-pandemic levels sometime after 2022-23.
