[SMM Nickel Midday Review] Nickel prices fell sharply on October 13, as Trump claimed to impose a 100% tariff on all Chinese goods.

SMM Nickel Market Update on October 13:

Macro and Market News:

(1) The Bureau of Labor Statistics (BLS) under the U.S. Department of Labor will "immediately resume" work on the September Consumer Price Index (CPI) data. According to the BLS, the report will be released at 8:30 a.m. Eastern Time on October 24, which is nine days later than the originally scheduled date of October 15.

(2) A spokesperson for the Ministry of Commerce responded to media inquiries regarding recent economic and trade policy measures taken by China. Regarding rare earth controls, the Ministry of Commerce stated that China's export controls do not constitute a ban on exports, and applications that meet the requirements will be approved. Prior to the announcement of the measures, China had notified relevant countries and regions through the bilateral export control dialogue mechanism. In response to the U.S. announcement of imposing 100% tariffs on Chinese goods, the Ministry of Commerce stated that threatening hefty tariffs is not the right way to deal with China. As for the tariff war, China's stance is consistent: we do not want to fight, but we are not afraid to fight.

Spot Market:

On October 13, the price of SMM #1 refined nickel was 121,000-123,900 yuan/mt, with an average price of 122,450 yuan/mt, down 1,400 yuan/mt from the previous trading day. The mainstream spot premium for Jinchuan #1 refined nickel was quoted in the range of 2,300-2,500 yuan/mt, with an average premium of 2,400 yuan/mt, up 100 yuan/mt from the previous trading day. The spot premiums and discounts for mainstream domestic brands of electrodeposited nickel were quoted in the range of -150-200 yuan/mt.

Futures Market:

The most-traded SHFE nickel contract (2511) opened at 121,050 yuan/mt on October 13, and was in the doldrums during the session. As of the midday close, it was quoted at 121,330 yuan/mt, down 1.75%.

Current U.S. policy uncertainty is weighing on the market, with the U.S. federal government shutdown entering its 12th day and former President Trump's threat last Friday to impose comprehensive 100% tariffs on Chinese goods sparking market concerns. Against the backdrop of weak fundamentals and a volatile external environment, nickel prices are expected to remain in the doldrums in the short term, with the most-traded SHFE nickel contract reference range at 120,000-124,000 yuan/mt.