European Inconel Prices Rebounds in Mid-Q2 of 2023, Reflecting Market Recovery

At the end of the third week of May 2023, the price of Inconel increased as the supply of raw materials declined. Nickel and chromium, being Inconel's major raw materials, have a limited supply from major exporting countries such as South Africa and Indonesia. As per market players, the import of raw material Nickel is getting disrupted due to the Indonesian ban on Nickel and other critical raw material ore export, as Indonesia is a major producer of Nickel. At the same time, chromium is facing difficulty in importing from South Africa as it is currently on low economic stability.

The demand for feedstock Nickel is rising in the electric vehicle industry as much of Nickel is being consumed in producing Nickel Metal Hydrate batteries for electric vehicles. According to the market player, Inconel's price in May was majorly impacted by the Nickel export ban from Indonesia. Indonesia is the lead producer of about 50% of the world's Nickel production. The Indonesian government stated that in June, they would ban the export of major ores, including Nickel, for all countries. The Indonesian government is playing a high bet on banning Nickel export as they hope these steps would increase investment and economic development in the Indonesian domestic market.

The downstream aerospace industry of Inconel in the European market has witnessed a rise in demand to produce more engines and turbine blades. The aerospace industry has grown in Europe due to increasing commercial and military aircraft demand. Inconel, being a high-temperature alloy, is preferred for producing turbine blades.

Furthermore, the price of Inconel has been affected by a disrupted supply of chromium from South Africa. Import of chromium to the European spot market decreased in May as South Africa, a major producer of chromium, is dealing with a crippling economy and weak employment. South Africa produces about 70% of the world's chromium production. If the supply of chromium to European and other countries diminishes, the probability of Inconel prices strengthening increases.

According to ChemAnalyst, the price of Inconel will increase in the upcoming month owing to the increased downstream demand amidst the shortage of major raw materials. The ban imposed by Indonesia on Nickel and other raw material export will cause a disturbance in the proper supply and fulfillment of nickel demand in the European spot market. South Africa's declining economy will create a tough market for Chromium supply. As a ripple effect of these factors, Inconel prices are anticipated to showcase an upsurge in the European market.