Nickel Prices Were Boosted by Overseas Energy Crisis

SHANGHAI, Dec 27 (SMM) - The energy shortage in Europe fermented again last week. The natural gas prices soared in many European countries, and the European aluminium smelters gradually reduced the production. The market was more concerned about the impact of energy crisis on the supply chain of commodities.

The nickel market saw no sign of production cut, but the nickel prices were boosted by the bullish sentiments. China’s nickel inventory increased slightly by more than 360 mt on the week amid rising nickel prices, and the premiums of refined nickel pulled back from a high level due to the weakening spot transactions. However, the overall transactions were moderate as the domestic traders were delivering the goods sold two weeks ago.

The prices of battery-grade nickel sulphate remained low on bearish sentiments, and its premiums over refined nickel shrank to 7,000 yuan/mt as the nickel prices rose. The NPI prices stopped falling and stabilised last week, and the price spread between refined nickel and NPI expanded further on rising nickel prices.

The two demand sectors of refined nickel did not provide strong support for the nickel prices, so the nickel prices may face resistance at around 150,000 yuan/mt. SHFE nickel is expected to trade between 143,000-151,000 yuan/mt this week, and the LME nickel is expected to move between $19,600-20,350/mt.