SMM Nickel Market Daily Review (2014-10-20)

SHANGHAI, Oct. 21 (SMM) – SMM #1 nickel prices were between RMB 107,200-107,500/mt. Inquiries from both traders and downstream buyers increased as spot nickel prices in Shanghai rose, with prices RMB 0-200/mt below 1411 nickel contract prices on the Wuxi electronics trading. But trading muted as spot price gains slowed, with traded prices between RMB 107,000-107,600/mt. Quotes were RMB 300/mt below 1411 nickel contract prices at one point, with traded prices between RMB 106,500-107,300/mt, and trading between traders. Jinchuan raised nickel prices RMB 500/mt to RMB 107,000/mt. downstream buyers by in large remained cautious with the exception of electroplaters.

SMM surveyed 32 market players with regard to nickel price trends this week and found that 28% believe LME nickel prices should hover between USD 15,300-15,800/mt. A series of economic indicators from China including Q3 growth and HSBC’s October PMI for China are not promising, but the likelihood is that China will push small stimulus measures in Q4.

72% are bearish, believing LME nickel prices will fall to USD 15,000/mt. LME nickel prices had grown 115,200 mt as of October 20, up 44%, meaning a soft demand worldwide. In addition, China’s economy is still weakening.