[SMM Nickel Midday Review] Nickel prices fell slightly on June 16, with total retail sales of consumer goods up 6.4% YoY in May

SMM Nickel News on June 16:

Macro News:

(1) The National Bureau of Statistics (NBS) announced today that in May, the total retail sales of consumer goods reached 4,132.6 billion yuan, up 6.4% YoY. Excluding automobiles, the retail sales of consumer goods amounted to 3,731.6 billion yuan, up 7.0% YoY. From January to May, the total retail sales of consumer goods were 20,317.1 billion yuan, up 5.0% YoY. Excluding automobiles, the retail sales of consumer goods were 18,432.4 billion yuan, up 5.6% YoY.

(2) The latest financial data released by the central bank showed that the growth rate of broad money supply (M2) remained basically stable, and the growth rate of aggregate social financing remained at a relatively high level. At the end of May, the outstanding aggregate social financing was 426.16 trillion yuan, up 8.7% YoY, 0.3 percentage points higher than the same period last year. In May, the incremental aggregate social financing was 2.29 trillion yuan, a year-on-year increase of 224.7 billion yuan. M2 grew by 7.9% YoY, narrow money (M1) grew by 2.3% YoY, and the balance of RMB loans grew by 7.1% YoY, remaining at around 8% after adjusting for the impact of local debt replacement. Based on historical patterns, economic activities tend to be more active in June, leading to a corresponding increase in financing demand. It is expected that the growth of financial aggregates will remain stable in the next stage.

Spot Market:

Today, the SMM 1# refined nickel price was 119,400-122,050 yuan/mt, with an average price of 120,725 yuan/mt, down 775 yuan/mt from the previous trading day. The mainstream spot premiums quotation range for Jinchuan #1 refined nickel was 2,400-2,600 yuan/mt, with an average premium of 2,500 yuan/mt, unchanged from the previous trading day. The quotation range for spot premiums and discounts of electrodeposited nickel from mainstream domestic brands was 0-400 yuan/mt.

Futures Market:

The most-traded SHFE nickel contract (NI2507) opened lower and fluctuated upward during the night session last Friday, but the price continued to weaken during today's daytime session, dropping to a low of 119,000 yuan/mt. As of 11:30, SHFE nickel closed at 119,690 yuan/mt, down 340 yuan/mt or 0.28% from the previous trading day.

In the short term, nickel prices are expected to fluctuate rangebound between 118,000-123,000 yuan/mt. If Indonesia tightens its nickel ore policies, it may trigger a phased rebound. However, in the medium and long term, the surplus pressure is difficult to resolve, coupled with a lack of incremental demand, limiting the upside room for nickel prices.