SMM Nickel Market Morning Comment (Nov 18)

During the week, refined nickel prices fluctuated downward, operating in the range of 124,000-129,000 yuan/mt. Fundamentally, there were no significant structural changes WoW. Last week, the demand from ternary cathode precursors, stainless steel, and alloy electroplating remained weak. Although the macro aspect saw a positive impact from the US interest rate cut, nickel prices continued to decline due to weak fundamentals and high inventories both domestically and internationally. From the perspective of the nickel industry chain, in the nickel sulphate sector, the purchase willingness for nickel sulphate by precursors remained low, with both supply and demand weak, leading to continuous price declines. In the NPI sector, NPI prices saw a slight correction due to the drag from stainless steel prices. Regarding the fundamentals of refined nickel itself, downstream alloy casting orders were relatively saturated before the year-end, and Q4 is expected to be the peak season for civilian nickel-based alloy demand. However, due to lower-than-expected orders and some refined nickel being replaced by scrap as raw material, coupled with certain inventory levels of raw materials, the incremental demand for nickel is limited. In the electroplating sector, the demand for refined nickel remained weak, with a heavy wait-and-see sentiment downstream, and no concentrated purchasing or stocking observed, resulting in low activity in nickel plate shipments. Overall, last week saw a weakening macro environment combined with bearish fundamentals, strengthening the downward trend for nickel prices. SMM expects that this week, nickel prices may continue the trend of last week, with room for further decline. The expected operating range is 118,000-126,000 yuan/mt.