[SMM Nickel Midday Review] August 12 nickel prices edged down, US Fed official Goolsbee reiterated that inflation remains the biggest concern.

SMM Nickel August 12 News:

Macro and Market News:

(1) US Fed official Goolsbee reiterated that inflation remains the biggest concern and that labour market indicators are not strong. The US dollar index was nearly flat, ultimately rising 0.01% to close at 99.83; the benchmark 10-year US Treasury yield closed at 4.693%; the 2-year US Treasury yield, sensitive to Fed policy rates, closed at 4.226%.

(2) US forces opened fire on a Panamanian-flagged cargo vessel attempting to breach the blockade on Iran in the Gulf of Oman; Iran's Supreme National Security Council reiterated that the Strait of Hormuz will not be reopened as long as the US does not accept its terms.

Spot Market:

On August 12, the SMM average price for #1 refined nickel was 129,200 yuan/mt, down 150 yuan/mt from the previous trading day. Regarding spot premiums, the average for Jinchuan #1 refined nickel was 1,300 yuan/mt, flat from the previous trading day, and the range for mainstream domestic brands of electrodeposited nickel was -200 to 400 yuan/mt.

Futures Market:

The most-traded SHFE nickel contract (2609) moved sideways in the morning session, closing at 128,800 yuan/mt by the end of the morning session, a decline of 0.16%.

Currently, nickel prices are in a highly uncertain state amid drastically swinging policy expectations, macro headwinds, and intertwined geopolitical risks. In the short term, prices are expected to swing wildly, with the most-traded SHFE nickel contract trading in the range of 125,000-133,000 yuan/mt.