The objective basis of the price difference between Lunni and Ferro-Nickel

伦镍与镍铁存在价差，价差存在的原因主要包括3点：

Lenny refers to the London Metal Exchange nickel futures contract, the subject matter is nickel with a nickel content of more than 99.9% (including nickel beans, nickel plates, nickel balls, etc.), as shown in the following figure:

The Ferro Nickel described in this article refers to a bulk object with a nickel content of 10% Mur15% and an iron content of more than 85%, as shown in the following figure:

The metal nickel of the subject matter of Lunni is used in stainless steel, non-ferrous alloy, superalloy, electroplating, battery, etc.; among them, non-ferrous alloy and superalloy are used in high-precision fields, which are profitable and belong to price-insensitive industries; ferronickel is basically 100% used in stainless steel and belongs to price-sensitive industries.

Application field of Lunni

The price regional attribute of Lunni is outside China, and the domestic metal nickel is mainly reflected by the nickel contract of the previous period. The essence of the regional attribute reflected by the Ferro-nickel price in this paper is China. Although the ferronickel producers come from China and Indonesia, the stainless steel made by them is basically used in China or exported to China.

Due to the three core reasons mentioned above, although the prices of Lunni and Ferro-nickel have the same trend, there are differences in prices. Take the average price from 2019 to October 2020 as an example, the average price of Lunni is $13628 / ton, and the average price of Ferro-nickel is $12958 / ton, with a price difference of $670 / ton.

Lunni has a financial attribute, and the monthly price fluctuation is affected not only by supply and demand, but also by capital sentiment; Nickel has no delivery contract, and the price trend is mainly affected by supply and demand factors.