[SMM Nickel Midday Review] Nickel prices edged lower on September 9, as China's manufacturing sector maintained its position as the world's largest for the 15th consecutive year.

SMM Nickel Market Update on September 9:

Macro News:

(1) MIIT: From 2020 to 2024, China's total industrial added value increased from 31.3 trillion yuan to 40.5 trillion yuan, while manufacturing added value rose from 26.6 trillion yuan to 33.6 trillion yuan. During the entire 14th Five-Year Plan period, the incremental manufacturing added value is projected to reach 8 trillion yuan, contributing over 30% to global manufacturing growth. The manufacturing sector's added value accounts for nearly 30% of the global total, maintaining its position as the world's largest for 15 consecutive years.

(2) The People's Bank of China renewed bilateral local currency swap agreements with the European Central Bank, Swiss National Bank, and Hungarian National Bank. The China-EU swap arrangement stands at 350 billion yuan/45 billion euros (valid for three years), the China-Switzerland swap at 150 billion yuan/17 billion Swiss francs (valid for five years), and the China-Hungary swap at 40 billion yuan/1.9 trillion Hungarian forints (valid for five years).

Spot Market:

On September 9, SMM #1 refined nickel prices ranged between 120,600-123,200 yuan/mt, averaging 121,900 yuan/mt, down 600 yuan/mt from the previous trading day. Jinchuan #1 refined nickel spot premiums quoted between 2,100-2,300 yuan/mt, averaging 2,200 yuan/mt, up 50 yuan/mt day-on-day. Domestic mainstream electrodeposited nickel spot premiums/discounts fluctuated between -100-200 yuan/mt.

Futures Market:

The most-traded SHFE nickel contract (2510) moved in the doldrums during the night session, closing at 120,860 yuan/mt, down 650 yuan/mt (0.53%). After opening lower on the morning of the 9th, it briefly rebounded before settling at 120,790 yuan/mt by midday, down 0.59%.

US non-farm payrolls added merely 22,000 jobs in August, significantly below market expectations of 75,000, with unemployment rising to 4.3%. Market expectations for a US Fed interest rate cut strengthened substantially, with liquidity easing prospects supporting nonferrous metal prices including nickel. However, persistent LME nickel inventory growth to 217,000 mt fundamentally caps price rebound potential. Short-term nickel prices may stage a limited rebound, with SHFE nickel expected to trade within 121,000-125,000 yuan/mt. Market focus remains on upcoming US CPI data this week—further inflationary pullback could reinforce rate cut expectations and boost nickel prices.