[SMM Nickel Midday Review] Nickel Prices Rise Slightly on October 27 as China-U.S. Economic and Trade Consultations Make Positive Progress

SMM Nickel October 27 News:

Macro and Market News:

(1) China and the US held economic and trade consultations in Kuala Lumpur, Malaysia. Li Chenggang stated that both sides constructively discussed solutions to properly address each other's concerns on issues including export controls, reciprocal tariff suspension extensions, fentanyl, and vessel charges, reaching preliminary consensus. The next step involves each side completing internal approval procedures.

(2) The US September unadjusted CPI annual rate came in at 3%, slightly higher than the previous month's 2.9%, marking the highest level since January 2025, but the increase was slightly below the market consensus of 3.1%. The seasonally adjusted CPI monthly rate for September was 0.3%, lower than the market expectation and the previous value of 0.4%. The US September unadjusted core CPI annual rate was 3%, below the market expectation and the previous value of 3.1%. The seasonally adjusted core CPI monthly rate for September was 0.2%, also lower than the market expectation and previous value of 0.3%. Following the release of the US CPI data, traders increased bets on the US Fed implementing two more interest rate cuts within the year.

Spot Market:

On October 27, the SMM #1 refined nickel price ranged from 121,400-124,400 yuan/mt, with an average price of 122,900 yuan/mt, up 750 yuan/mt from the previous trading day. The mainstream spot premium quotation range for Jinchuan #1 refined nickel was 2,500-2,600 yuan/mt, with an average premium of 2,550 yuan/mt, unchanged from the previous trading day. The spot premiums and discounts quotation range for mainstream domestic brands of electrodeposited nickel was -100-200 yuan/mt.

Futures Market:

The most-traded SHFE nickel contract (2512) pulled back after a slight surge during the night session, closing up 0.23% by the end of the session. It maintained a fluctuating trend during the morning session on the 27th, settling at 122,280 yuan/mt by the midday close, up 0.25%.

Recent China-US economic and trade consultations have yielded positive progress, with both sides forming preliminary consensus on properly resolving several important economic and trade issues, alleviating market concerns about escalating trade friction. Concurrently, the lower-than-expected US September CPI data has fueled ongoing market expectations for Fed interest rate cuts within the year. These factors collectively boosted market sentiment, creating a favorable macro environment. Nickel prices are expected to move sideways in the near term, with a reference price range of 120,000-124,000 yuan/mt.