It’s been a rough month for nickel prices following a brief glimmer-of-hope rally.
The base metal has slumped over the past four weeks with the nickel futures contract traded on the Multi Commodity Exchange (MCX) down more than 10% from its peak in October, according to a report from The Hindu Business Line. Additionally, global nickel spot prices have declined over the same time span, bringing domestic futures contracts down with them.
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We must look east for a cause of this decline in nickel over the past year. Weak demand from major consumer China continues to be a major contributing factor to nickel’s struggles. According to the news source, industrial production, trade data and inflation have all been on a downward swing, bringing nickel down as well.
With both the short- and medium-term outlooks of nickel grim, it’s difficult to predict a strong rally at this point.
Metals Round-Up
Taking a closer look at the other base metals we cover, zinc and lead recently showed some promising price gains, but our own Raul de Frutos threw cold water on that development. As it stands, all industrial metals are reaching new lows with commodities falling across the board with no end in sight for these price collapses.
Any rally should be perceived to be short-lived with a sharp decline pending. “Metal buyers may want to think twice before committing to large volumes in this kind of market,” de Frutos cautioned.
Source:Metalminer
