SMM Nickel Market Morning Comment Fully (Mar 19)

Overnight, the most-traded SHFE nickel contract opened at 142,030 yuan/mt, and closed at 139,950 yuan/mt, down 1,920 yuan/mt. Trading volume rose 50,346 lots, and open interest increased by 2,737 lots. On the macro front, the number of Americans filing for unemployment benefits stood at 209,000 in the week ending Mar 9, lower than the forecast and previous value, indicating that the US job market recovered. From a fundamental perspective, yesterday’s spot market transactions were weak. However, after nickel prices plunged in the afternoon, downstream buyers began to make purchases. Nickel price is expected to be move rangebound.
Nickel: On March 18, Jinchuan premium reported 1000-1200 yuan/ton, with an average price of 1100 yuan/ton, the average price was flat compared with the previous trading day. Russian nickel premium quoted -500 to -200 yuan/ton, with an average price of -350 yuan/ton, down 100 yuan/ton compared with the previous trading day.SHFE nickel widely shocked in the morning, running in the 140,000-142,000 range. Today's spot market trading atmosphere is still cold, downstream procurement intention to maintain a lower level.In addition, according to SMM research, some overseas refined nickel may arrive this week, and the supply will increase within the week.Today's nickel bean price 137000-137900 yuan/ton, compared with the previous trading day spot price increased 475 yuan/ton, and today's price difference between nickel bean and nickel sulfate is about 859 yuan/ton. (The price of nickel sulfate is 859 yuan/ton lower than that of nickel beans).The price of nickel sulfate continues to rise, and due to the lack of upward power, the price gap between electrolytic nickel and sulfate nickel is further narrowed.
Nickel sulfate: On March 18, SMM battery grade nickel sulfate index price was 29968 yuan/ton, 197 yuan/ton higher than the previous working day, battery grade nickel sulfate price was 29800-30300 yuan/ton, the average price was 200/ ton higher than the previous working day.At present, the MHP coefficient is still at a high level, and the LME nickel coefficient is 80-81.The downstream raw material preparation at the end of March and the beginning of April is relatively positive, therefore, the supply is tight, and the upward driving force of the cost side on the nickel salt price still exists.NPI: March 18 news, SMM8-12% high NPI average price is 949 yuan/nickel point (factory tax included), compared with the previous working day price flat.On the supply side, although the existing nickel ore quota approval number continues to rise, it still takes time from the mine to the smelter, so the current nickel iron production operating rate is still at a low level.However, on the supply side, the stainless steel plate continues to decline and the scrap price continues to fall, although the current economy of high NPI is still better than scrap, but the downward price of scrap also plays a certain driving role in the price of high NPI iron. Secondly, the terminal demand for stainless steel continued to be weak in the week, so the demand side did not give high NPI a boost. In summary, the current stainless steel terminal demand is still weak, so the supply side shows a trend of accumulation, and the current NPI price is expected to be weak.
Stainless steel: On March 18, the SS contract 2405 contract opened today at 13655 yuan/ton and closed at 13785 yuan/ton, down about 140 yuan/ton from last Friday's closing price. After bottoming out last week, the SS contract this week still maintained a strong trend, rising to a maximum of 13875 yuan/ton, and fell in the afternoon. Today's trading was 309,832 lots，an increase of 106,809 lots from the previous trading day, with open position of 157,710 lots, a decrease of 9045 lots from the previous trading day; The total turnover of the top five institutions today was 347,597 lots, an increase of 119,768 lots; The total number of multi-orders of the top five institutions was 40,295 lots, an increase of 130 lots; Short positions in the top five institutions total short single was 58,478 hands, reducing -3083 lots. Today's short actively closed positions, because the price fell to the bottom of the short side,and short side got good mentality. Multiple high orders passive closing, the short side pressure force reduced. According to SMM's research, a steel mill chrome steel price rose about 500 yuan on the weekend of. This week, although the opening price fell but it's still higher than the market expectations, boosted the SS contract, but LME nickel has a inventory accumulation, and domestic stainless steel surplus is serious. This afternoon the pull up weak began to fall, the SS contract will still be expected in weak operation with range volatility.