SMM Nickel Market Morning Comment (Sep 30)

Last week, nickel prices continued to fluctuate upward, with macro boosting factors still present. Macro side, there were reports that the domestic government is considering injecting 1 trillion yuan into large state-owned banks, possibly through the issuance of special government bonds. This news is seen as a potential policy boost for the real estate industry, influencing nickel prices to fluctuate upward. Fundamentally, in late September, the anticipated progress on Indonesia's domestic trade laterite nickel ore RKAB quota approval has not materialized, maintaining cost support on the fundamentals. If the RKAB quota is fulfilled next month and exceeds expectations in volume, it may lead the futures market to trade on this marginal supply easing sentiment. On the other hand, although nickel sulphate prices in the new energy sector have rebounded slightly, the main reason does not align with the potential improvement in downstream demand, leaning more towards some companies' necessity for restocking. The market does not hold an optimistic outlook on demand expectations. In the short term, despite some positive policy sentiment, the fundamentals continue to weaken. In this context, SHFE nickel is expected to operate in the range of 125,000-130,000 yuan/mt this week.