[SMM analysis] Nickel diving in Shanghai fell by more than 2%, but it was supported by the price rise of nickel mines in the short term!

SMM9 March 21: today, Shanghai Nickel opened low and dived in the afternoon, the decline quickly widened to more than 2%, and the futures price has fallen to a low of more than a month. By the end of the day, the main contract of Shanghai Nickel was 2011 at 114100 yuan / ton, down 1.99%. Since September, Shanghai Nickel has been out of place, fluctuating and falling all the way, reaching the lowest point of 113810 yuan / ton since August 14, losing the 114000 yuan / ton mark at one time. In the spot market, the price is still the same as last Friday.

In terms of inventory, Lunni inventory is basically stable, Shanghai Nickel inventory has fallen for six weeks in a row, as of last Friday, Lunni inventory fell slightly to 236526 tons. Since the beginning of March, Lunni inventory has basically stabilized at about 230,000 tons, and the current inventory has not changed much. In terms of Shanghai nickel inventories, weekly inventories fell 3.44 per cent to 31768 tons as of September 18, a new low since July 10.

The large increase in the price of nickel ore was the main focus of the spot market last week. The high price of nickel ore and the shrinking profit of stainless steel suppressed the profit of nickel pig iron. Under the comprehensive effect, there is little room for the price reduction of nickel pig iron and the possibility of production reduction at the end of the year is increased. Nickel fundamentals are partly supported.

SMM believes that recent nickel prices fluctuate mainly with macro factors, and the market releases the power of adjustment after a wave of weak market in the early days of the US dollar. in addition, many short-term factors are apparent in terms of fundamentals. in addition to the positive rising prices of nickel mines, there are also negative effects of stainless steel prices peaking to make nickel prices under pressure. therefore, although nickel prices do not have a long-term sharp downward trend, they are also relatively lack of power to pick up in the short term. It is estimated that this week, Shanghai nickel is 114000-120000 yuan / ton, Lunni is 14800-15400 US dollars / ton.

Institutional point of view:

Guoxin Futures: Shanghai Nickel fell sharply on Monday. Recently, the sharp weakening of the black series has dragged down stainless steel and nickel, the increase in the contribution of nickel and iron in Indonesia, the gradual accumulation of nickel ore port inventory has also begun to weaken nickel fundamentals, but the rainy season in the Philippines in November or support the lower space, it is expected that the future nickel shock is weak, it is recommended to test the light warehouse.

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