[SMM Nickel Midday Review] Nickel prices edged down on July 13, and Indonesia's Ministry of Energy and Mineral Resources said it would no longer increase RKAB quotas overall.

SMM Nickel, July 13:

Macro and market news:

(1) On the 12th local time, US President Trump said the US had launched a "heavy strike" against Iran the previous night. There were conflicting statements about the navigation status of the Strait of Hormuz. The Iranian Ports and Maritime Organization of the Persian Gulf posted on social media on the 12th that the Strait of Hormuz was currently impassable. Trump, however, said, "As far as the United States is concerned, the Strait of Hormuz remains open."

(2) Premier Li Qiang presided over a State Council executive meeting to hear a report on the progress of building a digital China and to study the cultivation of emerging pillar industries.

Spot market:

On July 13, SMM #1 refined nickel price fell by 250 yuan/mt from the previous trading day. In terms of spot premiums, the average premium for Jinchuan #1 refined nickel was 2,150 yuan/mt, down 100 yuan/mt from the previous trading day, while domestic mainstream brand electrodeposited nickel ranged from -300 to 500 yuan/mt.

Futures market:

The most-traded SHFE nickel 2609 contract edged down in the morning session, closing at 128,030 yuan/mt as of the morning close, up 0.02%.

Over the weekend, the US-Iran conflict took another turn, with the dollar and crude oil rising in tandem, weighing on metals. However, Indonesia's Ministry of Energy and Mineral Resources officially announced on July 10 that it would no longer raise the national nickel ore mining production quota across the board, and any increase in quotas would be very limited, with a strict special approval channel set up only for local smelters facing severe raw material shortages. In the short term, nickel prices could rebound, with the most-traded SHFE nickel contract price expected to trade in a range of 127,000-133,000 yuan/mt.