SHANGHAI (Interfax-China) -- China imported 3.78 million tonnes of nickel ore last year, a 6.8-fold increase compared with the previous year, according to statistics released by the General Administration of Customs.
Total nickel ore imports amounted to RMB 3.41 billion ($440 million) in 2006, 1.5 times the amount for 2005. However, average import prices declined by 67.7% to RMB 903.26 ($116.40) per tonne.
China's nickel ore imports from the Philippines reached 3.34 million tonnes, up 11.6% from 2005, which accounted for 88.5% of China's total nickel ore imports. In 2005, China's imports were mainly from Australian nickel mines.
According to the Shanghai Securities News, China's nickel ore imports surged last year because large quantities of low-grade nickel ore were imported from the Philippines, which also resulted in an average import price drop.
Low-grade nickel ore imports from the Philippines have a nickel content of 0.9% to 1.1%. Japan dominates high-grade nickel mines in the Philippines and has collaborated with the Philippines since 1970 to develop local nickel mines, with nickel ore grading 2%.
The rapid development of China's stainless steel production has increased demand for nickel, which is one of the raw materials for stainless steel.
China's nickel deposits are unable to meet domestic market demands, and China is therefore dependent on nickel ore imports. About two thirds of the nickel is used to produce stainless steel in China.
Current global nickel production is about 1.3 million tonnes a year, with two-thirds of the metal being used in stainless steel production, 10% in electroplating, 20% in alloys and coins.
China produced 419 million tonnes of crude steel in 2006, up 18.5% from a year earlier, according to statistics released by the National Bureau of Statistics yesterday.
Steel product exports hit a record 43.01 million tonnes last year, surging 109.6% from a year earlier. Net exports were 24.50 million tonnes for the whole year. The China Iron and Steel Association predicted in late 2006 that China would produce 462 million tonnes in 2007, up more than 10% from 2006.
Analysts believed that China's stainless steel output will increase by one third this year from last year's 6 million metric tonnes, with production capacity to hit 10 million tonnes by the end of this year.
© Interfax-China 2007
This article comes from Interfax China Commodities Daily, a daily digest produced by Interfax News Agency in Mainland China. To receive 5 free copies of this, please e-mail david.harman@interfax-news.com.
