[SMM Nickel Midday Review] Nickel Prices Drop Slightly on October 22 as Substantial Progress Emerges in Russia-Ukraine Conflict

SMM Nickel October 22 News:

Macro and Market News:

(1) Last night, Ukraine and major European countries issued a joint statement expressing firm support for US President Trump's stance that fighting should cease immediately and the current contact line should serve as the starting point for negotiations. The softening of Europe's attitude and Ukraine's active pursuit of ceasefire negotiations indicate substantive changes and momentum toward ending the Russia-Ukraine conflict.

(2) A Reuters survey conducted from October 15 to 21 among economists shows that the US Fed is expected to cut interest rates by 25 basis points each in the coming week and in December. However, economists remain deeply divided over the interest rate level by the end of next year. A month ago, economists anticipated only one rate cut this year, but this new forecast follows recent shifts among Fed policymakers toward supporting further rate cuts.

Spot Market:

On October 22, the SMM #1 refined nickel price stood at 120,700-123,500 yuan/mt, with an average price of 122,100 yuan/mt, down 400 yuan/mt from the previous trading day. The mainstream spot premium quotation range for Jinchuan #1 refined nickel was 2,400-2,600 yuan/mt, with an average premium of 2,500 yuan/mt, up 50 yuan/mt from the previous trading day. The spot premium/discount quotation range for mainstream domestic brands of electrodeposited nickel was -100-200 yuan/mt.

Futures Market:

The most-traded SHFE nickel contract (2511) moved downwards after a higher opening during the night session, and remained in the doldrums during the morning session on the 22nd. As of the midday close, it was quoted at 121,040 yuan/mt, down 0.28%.

Recent focus should be on US inflation data and signals from the US Fed's policy, while progress in China-US trade talks will also impact the market. Against a backdrop of weak fundamentals and external volatility, 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.