NICKEL ore producer Global Ferronickel Holdings, Inc. (FNI) on Monday said that it had signed a new nickel supply deal with Chinese firm Baosteel Resources International Co. Ltd.

In a disclosure to the stock exchange, the company said the deal covers an annual purchase agreement for 1.5 million wet metric tons (WMT) of nickel ore.

The ore will be sourced from the operating mines of its subsidiaries Platinum Group Metals Corp. in Surigao del Norte and Ipilan Nickel Corp. in Palawan.

“Our two operating mines have given us the ability to undertake year-round production to better support the growing demand from China,” said FNI President Dante R. Bravo in a statement.

“The easing of COVID-19 restrictions and the robust growth of China’s property sector that is driving the need for stainless steel will help boost the nickel industry,” he added.

According to the company, one-third of the shipment will be composed of low-grade nickel ore with 0.90% nickel content and 49% iron content.

The remainder will be medium- to high-grade nickel ore with 1.3-1.6% nickel content and 15-23% iron content.

“The selling price of each shipment will be set on a monthly basis according to the prevailing market price at the time of price setting,” said FNI.

Baosteel, which is a unit of China Baowu Steel Group, has business interests in mineral resource investment, trading, and logistics services.

FNI is a holding firm that has been engaged in nickel ore mining, logistics, cement and steel production, and port operations.

On Monday, shares in the company fell by P0.04 or 1.67% to close at P2.35 apiece. — Sheldeen Joy Talavera