[SMM Nickel Midday Review] Nickel prices rebounded sharply on May 30, with China urging the US to completely abolish unilateral tariff hikes

SMM Nickel News on May 30:

Macro News:

(1) The US announced the revised annualized quarter-on-quarter rate of real GDP for Q1 and the initial jobless claims data for the week ending May 24. The revised GDP was -0.2%, better than the market expectation of -0.3% and slightly improved from the previous -0.3%, but still indicating an economic contraction. The revised annualized quarter-on-quarter rate of the core PCE price index was 3.4%, lower than the expected 3.5% and the previous 3.5%, suggesting a slight easing of inflationary pressures. Initial jobless claims were 240,000, higher than the expected 230,000 and the previous 226,000 (after revision), indicating increased short-term pressure in the labour market. These data triggered an immediate market reaction, with the US dollar index falling in the short term, gold prices rising slightly, and market sentiment oscillating between optimism over easing inflation and concerns about weak employment.

(2) In response to questions about whether the economic and trade teams of China and the US had recently held consultations, He Yongqian, spokesperson for the Ministry of Commerce, stated that China had repeatedly engaged with the US over the US's abuse of export control measures in the semiconductor sector. China once again urged the US to immediately correct its wrongful practices, cease discriminatory restrictive measures against China, and jointly uphold the consensus reached at the high-level talks in Geneva. China also urged the US to completely eliminate unilateral tariff hikes.

Spot Market:

Today, the SMM 1# refined nickel price is 120,900-123,750 yuan/mt, with an average price of 122,325 yuan/mt, an increase of 800 yuan/mt from the previous trading day. The mainstream spot premium quotation range for Jinchuan #1 refined nickel is 2,500-2,700 yuan/mt, with an average premium of 2,600 yuan/mt, an increase of 100 yuan/mt from the previous trading day. The premiums and discounts quotation range for Russian nickel is 100-400 yuan/mt, with an average premium of 250 yuan/mt, unchanged from the previous trading day.

The most-traded SHFE nickel contract (NI2507) opened significantly higher in the night session yesterday, closing up 1.25% at 121,240 yuan/mt. The morning session continued with a fluctuating trend, and as of 11:30, the closing price was 120,810 yuan/mt, up 0.89%.

Futures Market:

The most-traded SHFE nickel contract (NI2507) fell sharply during the day session yesterday, closing at 119,950 yuan/mt, a daily decline of 2.1%, and a cumulative weekly decline of 3.2%, breaking below the key support level of 120,000 yuan/mt. The night session continued to probe lower, reaching a low of 118,630 yuan/mt. Prices rebounded somewhat in the morning session today, returning to the 120,000 yuan level, but still remained in the doldrums. As of 11:30, the closing price was 120,340 yuan/mt, up 0.72%.

The contradiction of medium and long-term global nickel overcapacity remains unresolved, with the nickel market under triple pressures of "high supply, weak demand, and tight capital". In the short term, the bottom of the oscillation is seen at 115,000 yuan/mt Ni, while the top is under pressure at 123,000 yuan/mt Ni.