[SMM Nickel Midday Review] Nickel prices plunged sharply on May 12, with serious disagreements currently existing in US-Iran negotiations

SMM Nickel News, May 12:

Macro and market news:

(1) An Iranian official said on May 11 that serious disagreements existed between Iran and the US in negotiations over the disposal of enriched uranium, the duration of uranium enrichment suspension, and war reparations.

(2) The PBOC released its Q1 2026 China Monetary Policy Implementation Report. The report proposed continuing to implement a moderately accommodative monetary policy, flexibly utilizing various monetary policy tools to maintain ample liquidity and relatively accommodative social financing conditions. The report also noted that as of month-end March, financial institutions had signed stock buyback and stake-increase loan contracts totaling approximately 370 billion yuan, with over 180 billion yuan already disbursed.

Spot market:

On May 12, SMM #1 refined nickel prices fell 1,450 yuan/mt from the previous trading day. Spot premiums: Jinchuan #1 refined nickel averaged 1,200 yuan/mt, unchanged from the previous trading day, while domestic mainstream brand electrodeposited nickel ranged from -700 to 500 yuan/mt.

Futures market:

The most-traded SHFE nickel 2606 contract surged in early trading before dropping sharply, closing the morning session at 145,980 yuan/mt, down 0.71%.

Although Iran and the US had previously come close to reaching an agreement framework, the negotiations ultimately failed to sign formal terms. If the geopolitical stalemate continues to escalate and sulfur supply constraints remain unresolved, nickel prices still have upside room. In the short term, the most-traded SHFE nickel contract is expected to trade in the range of 145,000-150,000 yuan/mt.