SMM Nickel, September 21:
Macro and market news:
(1) The aftershocks of the US Fed's rate hike have yet to subside, with US Treasury yields returning to 5%. The 10-year Treasury yield rose 4.9 bp last Friday to 4.995%, while the 2-year yield hit a 52-week high at 4.741%; the US dollar index gained 1.14% for the week, its biggest weekly gain in three months, as the market continued to price in another hike in October. US stocks were mixed, with the Dow falling 0.18% in a four-day losing streak, while the Nasdaq rose 0.39% alone; roughly $7 trillion in options expired on "triple witching" day.
(2) Oil prices fell for a third day, but Middle East supply risks remain. Saudi Arabia repaired the attacked pipeline and adjusted export routes; WTI settled down 1.31% at $95.26/bbl, and Brent fell 0.86% to $98.85/bbl. However, Houthi forces struck Saudi Aramco facilities again, Saudi Arabia notified European clients that October term crude supply would be cut to zero, only four cargo ships passed through the Strait of Hormuz last Thursday (normally around 16), US retail diesel hit a record high of $6.45/gallon, and Macron planned to convene the G7 to discuss coordinated release of strategic oil reserves.
(3) China-US economic and trade consultations kicked off in New York. He Lifeng led a delegation to the US for talks from September 19 to 23, paving the way for the "Trump-Xi meeting" on September 24, with topics covering AI, tariffs, and critical minerals. Domestically, the September LPR was announced today, with the 1-year at 3.00% and the 5-year at 3.50%, both unchanged; last Friday, A-shares surged on heavy volume back above the 3,900-point level, with turnover returning above 2 trillion yuan; both onshore and offshore yuan strengthened past 6.70, hitting a new high since January 2023.
Spot market:
On September 21, the average price of SMM #1 refined nickel was 125,950 yuan/mt, up 200 yuan/mt from the previous trading day. In terms of spot premiums, the average for Jinchuan #1 refined nickel was 4,100 yuan/mt, down 250 yuan/mt from the previous trading day, while mainstream domestic electrodeposited nickel brands ranged from 0 to 500 yuan/mt.
Futures market:
The most-traded SHFE nickel contract (2610) consolidated in a narrow range in early trading, closing the morning session at 123,920 yuan/mt, up 0.05%.
Short-term outlook:
With the BOJ rate hike landing, the lingering hawkish aftershocks from the US Fed, and oil prices pulling back, bullish and bearish factors are intertwined. SHFE nickel has moved sideways for three consecutive days. Going forward, attention should be paid to month-end production schedules for nickel-related products in Indonesia and China. In the short term, the most-traded SHFE nickel contract is expected to trade in the range of 122,000-126,000 yuan/mt.
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![[SMM Nickel Sulphate Daily Review] Spot market remains sluggish on Sep 21, nickel sulphate prices edge down](https://imgqn.smm.cn/usercenter/NHXhQ20251217171733.jpg)
