SHANGHAI, Jan. 29 -- LME nickel prices opened at USD 18,000/mt and closed at USD 18,200, with highest level at USD 18,500/mt and lowest level at USD 17,740/mt, up USD 400/mt.
Although US dollar experienced strong performances, it failed to significantly depress LME nickel prices. LME copper prices slumped, driven by panic selling technically. Market is waiting for the outcome of labor contract at nickel mine in Sudbury, Canada, under Xstrata PLC, and the current labor contract will be expired on January 31st. Market concerns that there may have labor strike, current market concern that labor strike will affect the supply of nickel is the major factor pushing up rebound of nickel prices.
Furthermore, supply of low-priced nickel was rarely seen in the market, while nickel resources in bonded areas were consumed significantly, with market participant reporting that inventories lowered significantly. In addition, nickel prices in the Shanghai spot market received relatively strong support due to relatively tight supply of low-priced spot goods. Prices of LME nickel prices declined to USD 17,740/mt or RMB 141,000/mt, lower by 4,000/mt compared with the level ex-works prices from Jinchuan Group, stimulating buying in overseas market, and in turn pushing up LME nickel prices.
However, particular attention should be paid to the production at downstream industries when prices rebounded in the short term. In addition, tight supply of NPI in domestic market eased compared with previous situation, and market players should pay attention to risks.
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