[SMM Nickel Midday Commentary] On March 12, nickel prices retreated after rapid rise, and the US February CPI met market expectations

SMM Nickel, March 12:

Macro and Market News:

(1) US February CPI rose 2.4% year on year, and core CPI rose 2.5% year on year, in line with market expectations.

(2) Trump said Iran had "nothing left to strike," and the war would end soon. The Iranian president proposed three necessary conditions for ending the war: recognizing Iran's legitimate rights, paying war reparations, and providing firm guarantees from the international community to prevent future acts of aggression.

Spot Market:

On March 12, the SMM price of #1 refined nickel rose by 1,200 yuan/mt from the previous trading day. In terms of spot premiums, the average price of Jinchuan #1 refined nickel was 6,750 yuan/mt, up 100 yuan/mt from the previous trading day; China mainstream brands of electrodeposited nickel were at -300-400 yuan/mt.

Futures Market:

The most-traded SHFE nickel contract (2605) surged in the night session, but fell sharply during the morning session, closing the morning session at 137,400 yuan/mt, up 0.08%.

On the macro front, there were signs that the risk-off sentiment stemming from geopolitical conflicts in the Middle East was easing in the short term. Supply side, the core driver remained Indonesia's unchanged policy of tightening nickel ore supply. In the short term, the price of the most-traded SHFE nickel contract is expected to move sideways in the 130,000-140,000 yuan/mt range.