Pacific Metals Cultivates China FeNi Market

Pacific Metals, the largest ferronickel maker in Japan tries to get long term supply agreements with Chinese small sized stainless steel makers. The firm develops growing Chinese market, which represents 25% of the firm’s total sales volume. Currently, the export to China stays at low level while Japanese stainless steel makers increase the production. Pacific Metals’ ferronickel shipment is estimated at 9,000 tonnes in October-December 2009 as same as July-September. The firm targets to secure stable buyers and raw materials sources to stabilize the operation.

Pacific Metals has developed the market in China from several years ago. The firm has experimentally exported ferronickel to major stainless bar and shape maker in China. Pacific Metals aims to shift long supply deals with Chinese stainless makers while the firm started to export ferronickel to India in 2008.

Ferronickel shipment of Pacific Metals was 5,000 tonnes in October-December 2008 when stainless steel makers reduced the output all over the world after financial crisis. While domestic makers continued output reduction, Chinese makers has been increasing ferronickel purchase since the beginning of 2009 when the demand in infrastructure increased and nickel price increased. Pacific Metals’ shipment was 7,000 tonnes in January-March 2009 and about half of the shipment was export to China.

The firm keeps quarterly 9,000 tonnes of sales in July-September as April-June when stainless steel makers in South Korea and Taiwan increase the purchase while Chinese makers decrease the purchase due to output reduction. Pacific Metals operates 2 electric furnaces in Hachinohe plant at full capacity operation.

Pacific Metals constructed nickel enriching test plant in Hachinohe to use low grade nickel ore. The plant is scheduled to start operation until the end of 2009. Nickel ore grade is lowering year by year and now the purity is around 2.1%. The firm increased the purity to around 40% through the plant by melting low grade ore with around 1.5% of nickel. The firm plans to build the commercial level of enriching plant near the offshore nickel mine and to import concentrated nickel to Japan in future.