[SMM Nickel Midday Review] On August 21, nickel prices fluctuated rangebound, with spot premiums on the rise

SMM Nickel Update on August 21:

Macro News:

(1) On Wednesday, the minutes of the US Fed's July meeting showed that at last month's meeting, where it was decided to keep the benchmark interest rate unchanged, only two officials voted against (advocating for an interest rate cut) and did not receive public support from their colleagues. The minutes stated, "Almost all participants judged that maintaining the target range for the federal funds rate at 4.25%-4.50% at this meeting was appropriate."

(2) On August 18, 2025, Xie Feng, China's ambassador to the US, met with Richard N. Haass, president of the Council on Foreign Relations. They exchanged views on issues of mutual concern, including Sino-US relations and economic and trade cooperation. Ambassador Xie introduced China's efforts in accelerating the construction of a new development pattern and promoting high-level opening up, elaborated on China's principled position on developing Sino-US relations, and expressed hope that the Council on Foreign Relations would continue to play a positive role in enhancing mutual understanding between China and the US and promoting the stable, healthy, and sustainable development of Sino-US relations.

Spot Market:

Today, the SMM #1 refined nickel price is 119,700-122,500 yuan/mt, with an average price of 121,100 yuan/mt, up 200 yuan/mt from the previous trading day. The mainstream spot premiums for Jinchuan #1 refined nickel are quoted at 2,400-2,600 yuan/mt, with an average premium of 2,500 yuan/mt, up 100 yuan/mt from the previous trading day. The quotation range for domestic mainstream brands of electrodeposited nickel spot premiums and discounts is -100-300 yuan/mt.

Futures Market:

The most-traded SHFE nickel 2509 contract opened lower and fluctuated rangebound, with no significant price changes. By midday, the SHFE nickel quote was 119,940 yuan/mt, down 0.13% for the day.

Currently, nickel prices are mainly influenced by macro sentiment. Expectations of loose domestic policies and a phase of US dollar pullback provide support to nickel prices, but upside room remains constrained by geopolitical uncertainties and high inventory pressure. In the short term, nickel prices will oscillate in a tug-of-war between longs and shorts, driven by weak fundamentals and supportive macro sentiment, within a price range of 119,000-123,000 yuan/mt.