[SMM Nickel Midday Review] On June 10, nickel prices continued to plunge sharply, and CPI rose 1.2% YoY in May.

SMM nickel, June 10:

Macro and market news:

(1) National Bureau of Statistics (NBS): May CPI up 1.2% YoY, PPI up 3.9% YoY. National industrial producer ex-factory prices up 3.9% YoY, up 0.5% MoM. Industrial producer purchase prices up 5.8% YoY, up 1.3% MoM.

(2) According to Nikkei: The Bank of Japan plans to raise interest rates to 1% at its June meeting.

Spot market:

On June 10, SMM #1 refined nickel prices fell 2,200 yuan/mt from the previous trading day. Regarding spot premiums, the average for Jinchuan #1 refined nickel was 1,150 yuan/mt, up 100 yuan/mt from the previous trading day; China’s mainstream electrodeposited nickel brands ranged from -500 to 400 yuan/mt.

Futures market:

The most-traded SHFE nickel 2607 contract continued to drop sharply during the session, dipping to 134,000 yuan/mt, and closed the morning session at 134,310 yuan/mt, down 2.29%.

After the US nonfarm payrolls far exceeded expectations, market bets on rate hikes surged significantly, the US dollar index hit a two-month high, US bond yields stayed high, and macro headwinds continued to weigh on risk asset prices. US-Iran peace talks remain in a tug-of-war; sulfur cost support logic persists but the marginal impact of geopolitical news is diminishing. In the short term, nickel prices have slumped sharply under macro pressure, leaving room for a rebound ahead.