SHANGHAI, Nov. 17 (SMM) – SMM #1 nickel prices were between RMB 72,600-73,600/mt on November 16. Premiums of Jinchuan nickel prices were RMB 100/mt against the most actively traded contracts on the Wuxi electronic trading in the morning, with traded prices between RMB 73,000-73,100/mt. Discounts of Russian nickel prices were RMB 400/mt against the most actively traded contracts on the Wuxi electronic trading in the morning, with traded prices between RMB 72,700-72,800/mt.
Traders sold proactively as nickel imports grew on higher SMM/LME nickel price ratio, with overall trading lackluster. Traders sold actively in the afternoon with the delivery of SHFE 1511 nickel contracts, but downstream buyers refrained from buying, with traded prices between RMB 72,700-73,100/mt.
SMM surveyed 30 market players to find that 20 are neutral toward nickel prices and 10 are bearish.
The 67% neutral ones expect LME nickel to move between USD 9,350-9,500/mt. Paris attacks will unlikely affect the market significantly. The US dollar should strengthen as major economic indicators from the US slated for release this week are promising, weighing on base metals. The regions in the Philippines that are not affected by the monsoon season will ramp up nickel ore exports, and this will impact nickel ore prices. Some stainless steel plants suspended production of #200 stainless steel but turned to #300 stainless steel, growing nickel demand. Besides, SHFE nickel prices have already fallen sharply recently. SHFE 1601 nickel should move between RMB 72,500-73,500/mt.
33% are bearish, seeing LME nickel prices fall to USD 9,100-9,350/mt. The US dollar is expected to rise further due to upbeat economic indicators. The slowdown in China, combined with slower housing starts, will depress market confidence. A rising SMM/LME nickel price ratio will cause additional inflows of imported nickel. When combined with shipments from regions in the regions in the Philippines that are not affected by the monsoon season, nickel will remain in oversupply in China. Meanwhile, stainless steel prices are facing pressure, so stainless steel plants will further lower bid prices for NPI. SHFE 1601 nickel will hover between RMB 71,500-72,500/mt.