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Macro uncertainties shadows nickel market

Date 11/8/2018 5:14:28 PM Source: SHMET

SHANGHAI, Nov 8 (SHMET) – Spot nickel prices were offered at 97,100-106,000 yuan/mt on Thursday November 8, falling down 950 yuan/mt. Spot premium for Jinchuan nickel came to 9,200 yuan/mt compared with Wuxi 1811 contract, and 9,320 yuan/mt compared with SHFE nickel three-month contract. Russian nickel saw premium of 350 yuan/mt compared with Wuxi 1811 contract, and was at a premium of 420 yuan/mt over with SHFE nickel 1901 contract.

SHFE nickel moved down in a range bound in the morning, but the fall was limited with firm support technically. Traders still took Wuxi 1811 contract as the main contract. Some traders offered Russia nickel at premium of 400 yuan/mt in the morning, but revised it down by 50 yuan/mt later with thin trades. LME nickel price ran in a range bound and spot offers were in chaos as a result.

On macro side, US dollars were forced onto its back foot Wednesday after opposition Democrats captured the House of Representatives in the US midterm elections, adding expectation that US will not unveil policies to boost economy. For buyers, that means dollar priced metals become cheaper. Meanwhile, LME nickel remained weak.

Sustained shrinking inventory supported nickel price. However, trades remained insipid due to persistent bearish outlook and suspension of part trades during China International Ni & Co Industry Forum 2018. Anyway, to maintain production, some consumers still had to purchase despite of high price.

NPI offer remained stable on November 8. Statistics showed signs of production expansion, which was expected to hinder the upside of NPI price. Dragged down by poor consumption, stainless steel market was lackluster with lower prices.

In summary, macro uncertainties clouded nickel market. Transactions were made as required. Overall trades were expected to remain weak amid cautious sentiments.

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