Overnight, the most-traded SHFE nickel contract opened at 128,990 yuan/mt, and closed at 130,530 yuan/mt, down 1,020 yuan/mt. Trading volume fell by 42,985 lots, and open interest decreased by 2,574 lots. From a macro perspective, the US Fed has kept the upper limit of its interest rate at 5.5%. The Fed once again maintained interest rates unchanged. Powell's speech has not disclosed when to cut interest rate. This interest rate decision will have little impact on the market. Fundamentally, the progress of nickel ore approval accelerated and production of intermediate product projects in Indonesia ramped up. The market's expectations for tight supply of raw materials began to weaken. On the other hand, affected by the sharp drop in nickel prices, transactions in the spot market picked up, and downstream purchasing sentiment recovered. Nickel price is expected to go down.

Nickel: During the trading session on March 28, the opening price of the main SHFE nickel contract was 128,990 yuan/mt, with a closing price of 130,530 yuan/mt, an increase of 1,020 yuan/mt compared to the previous trading day's closing price. Trading within the session weakened compared to the previous trading day, with a decrease in trading volume of 42,985 lots and a decrease in open interest of 2,574 lots. This combination indicates a strong atmosphere of wait-and-see among both long and short parties, with both sides reducing their trading activities. The decrease in open interest and the increase in prices indicate that the futures short side is conceding defeat and actively covering short positions (i.e., buying to hedge), pushing up prices. Although the short side is actively closing positions, it is relatively rational, seeking ideal prices without urgency. Therefore, the price is gradually rising, with a high probability of sustained upward movement. From a macro perspective, the decision on the upper limit of the US Federal Reserve interest rate recorded 5.5% as of March 20. The Fed once again maintained its stance, and Powell's speech did not reveal any clear interest rate cut timing, so the impact of this interest rate decision on the market was relatively minor. On the fundamental side, progress in nickel mine approvals has accelerated, and Indonesian intermediate projects have begun to release output gradually, leading to a weakening of market expectations for tight raw material supply. However, influenced by the sharp decline in nickel prices, the spot market transaction atmosphere has warmed, and downstream purchasing sentiment has recovered. Overall, it is expected that nickel prices will continue to fluctuate weakly in the future.

NPI: On March 28, the average price of SMM 8-12% NPI remained unchanged at 933 yuan/mtu (factory including tax) compared to the previous working day. From the supply side, although the approval speed of nickel ore quotas has recently accelerated significantly, it still takes time from the mine to the smelter, so it is expected that NPI production in March will still be at a low level. This week is the last trading week of March, and overall NPI shipments in March are relatively light. Financial pressure has prompted some traders to sell at low prices to recover funds. From the demand side, except for a certain steel mill in South China that is still purchasing, other domestic steel mills have no intention to purchase, and transactions are still dominated by buyers. Overall, the current stainless steel terminal demand remains weak, leading to an accumulation of supply, and the current NPI prices are expected to be weak.

Nickel Sulfate: On March 28, the SMM battery-grade nickel sulfate index price was 30,653 yuan/mt, a decrease of 3 yuan/mt from the previous working day (automatically adjusted weight), with the price of battery-grade nickel sulfate ranging from 30,500 to 31,000 yuan/mt, with an average price unchanged from the previous working day. The current inquiry activity has weakened slightly, and the procurement of precursor materials by some enterprises is approaching the end in mid to late April. The center of gravity of transactions is relatively average. Influenced by the downward fluctuation of nickel prices, downstream psychological price for nickel salt procurement has decreased slightly, but due to the temporary tension between supply and demand for nickel salt, the current transaction prices remain stable.

Stainless Steel: According to SMM research on March 28, today's stainless steel spot prices remained stable. Although there was pressure on the rise after the previous decline stimulated downstream transactions, there were fewer low-priced sources of stainless steel, and mainstream transaction prices rebounded slightly. Regarding social inventory, the supply decreased this week, the transaction improved, and inventory digestion was relatively good. With the improvement of the supply-demand pattern in the future, stainless steel prices will rebound to a certain extent. In the early morning of the day, the price of 304 cold-rolled in Wuxi was reported at 13,400-13,800 yuan/mt, 304 hot-rolled in Wuxi was reported at 12,950-13,050 yuan/mt, 316L cold-rolled in Wuxi was reported at 24,100-24,400 yuan/mt, 201J1 cold-rolled in Wuxi was reported at 8,600-8,800 yuan/mt, and 430 cold-rolled in Wuxi was reported at 8,100-8,200 yuan/mt. At 10:30 on the SHFE, the price of the SS2405 contract was 13,325 yuan/mt, and the spot premium for stainless steel in Wuxi was 195-495 yuan/mt (cut-off = raw edge + 170 yuan/mt).