SMM Morning Review – 2012/3/20 Nickel Market

SHANGHAI, Mar.20 (SMM) -- LME nickel prices initially moved stably after opening at USD 19,050/mt, but later fell to test USD 18,775/mt. Boosted by upbeat economic data from the US, LME nickel prices surged to USD 19,023/mt and the tail of the trading, up USD 143/mt from a day earlier.

In the Shanghai nickel spot market, spot nickel prices tracked LME nickel prices to drift lower after a low opening, but transactions were moderate. Jinchuan Group cut ex-works nickel prices by RMB 3,000/mt to RMB 135,000/mt. During the morning trading hours, mainstream traded prices of nickel from Jinchuan Group were in the RMB 135,500-135,800/mt range, and mainstream traded prices of nickel from Russia were in the RMB 134,700-135,000/mt range. During the afternoon trading hours, traders lowered prices slightly to promote sales, with average traded prices of Jinchuan nickel around RMB 135,500/mt and Russian nickel around RMB 134,500/mt.

SMM expects that weak fundamentals will cap gains of LME nickel prices on Tuesday. Although LME nickel prices closed with gains overnight, spot nickel prices will not be supported and shall move in the RMB 134,800-135,800/mt range on Tuesday.