HFE Nickel Rebounded Slightly amid the Easing Tight Supply

SHANGHAI, May 23 (SMM) - SHFE 2204 nickel contract opened at 211,130 yuan/mt in the early trading of May 23. The closing price stood at 207,750 yuan/mt, down 5,050 yuan/mt from the closing price on May 20. Market transactions were thin with trading volume down by 27,605 lots. Open interest decreased by 6,180 lots. In terms of technical aspects, a large number of short buyers were eager to sell to close their positions and prices may continue to fall in the short term. Fundamentally, affecting by the delivery of pure nickel 2205 contract, the tight sources of pure nickel eased and the futures prices generally fell. Pure nickel imports gained profits recently. Due to the high spot premiums last week, clearance has not been finished. The clearance may increase sharply as the spot premiums fall, which may ease the tight supply to a certain extent. On the demand side, although the central bank cut interest rates last week, the macroeconomic improved. With prevailing pandemic, operating rates and orders of downstream alloy manufacturers were still not optimistic with weak demand. To sum up, the nickel prices lack of upward momentum. The market shall focus on the clearance situation this week.

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