[minutes of nickel internal morning meeting] Pure nickel transaction light NPI stalemate in steel mill price pressure

On the macro front, the dollar recovered slightly yesterday as the US and Mexico reached an agreement to boost risk appetite among investors, while sterling tumbled and helped the dollar as a result of a number of poor economic data in the UK. The monthly rate of decline in manufacturing output in April was the lowest since June 2002. The monthly rate of industrial output fell in April from the previous month, the lowest since September 2012. The General Administration of Customs reported that China's imports and exports in May performed well. China's trade account surplus in May was 279.12 billion yuan, with an expected surplus of 136 billion yuan, compared with a previous surplus of 93.57 billion yuan. Exports rose 1.1 per cent year-on-year better than expected. On the last trading day before the festival, the central bank carried out incremental medium-term lending to small and medium-sized banks to facilitate (MLF) operation, with a total operating volume of 500 billion yuan, and the winning interest rate was 3.30% the same as that of the previous period. At the same time, a 7-day reverse repurchase operation of 10 billion yuan was carried out with a winning interest rate of 2.55 per cent. According to the data, 463 billion yuan of one-year MLF expired on June 6, and another 30 billion yuan of reverse repurchase expired. Today, you can focus on the May core PPI annual rate in the United States, the EIA monthly short-term energy outlook report, and the actual annual rate of foreign direct investment in China.

Spot nickel market: SMM 1 # electrolytic nickel 96650 to 97700 yuan / ton. Yesterday, Russia nickel more than Wuxi 1906 general water, individual traders reported discount 50 yuan / ton, but the source of goods is not much. Compared with Wuxi 1906 contract, Jinchuan nickel generally reported a water rise of 1000 yuan to 1, 100 yuan per ton. Monday market price rebound, traders feedback light transaction, mainly due to the absolute price rise led to downstream procurement caution, and last week downstream has been actively stocked, there is still inventory consumption. In the early trading session, before the price rose sharply, there were a small number of transactions. As the price continues to rebound, the transaction becomes worse, but the holder is basically dominated by rising water. Jinchuan ex-factory price quoted 97500 yuan / ton, up 1100 yuan / ton from Friday, the mainstream transaction at 96600-97700 yuan / ton. Nickel prices continued to fall in the afternoon, but the overall price is still higher than before the festival, downstream enthusiasm is still not high, but the holder is still rising. The mainstream transaction is 96300 to 97700 yuan / ton.

Nickel pig iron market: according to SMM research, yesterday a steel mill in the south this week high nickel iron inquiry price is 940 yuan / nickel point, to the plant including tax, the inquiry price is the same as last week. As of this morning, I have not heard of the transaction, the supplier believes that the price converted into ex-factory price is only 920 yuan / nickel point, the difference between the price and the disk price is too large, so it is basically unacceptable. Other stainless steel plants have also released their willingness to slow down purchase inquiries. In terms of profit, the current price is already in an unprofitable state for the higher cost electric furnace nickel pig iron plant, and the monthly output of this part is about 20,000 physical tons. If the price center of nickel pig iron continues to be depressed, Whether there will be a reduction in production in the later period is worth noting.

Stainless steel market: yesterday stainless steel factory guidance price is flat than before the festival, Wuxi market, 3042B (Hongwang) quoted 13700-13800 yuan / ton; 201-2B (Hongwang) quoted price 8200-8250 yuan / ton. Some agents said that on the first day after the festival, the overall trading environment of the stainless steel market changed little, maintained a stable situation, and the actual transaction price maintained a profit space of 50 to 100 yuan per ton.

In terms of stocks: nickel stocks were 163900 tons on 10 June, a decrease of 90 tons compared with 6 June.

Judgment of nickel price: the relatively stable output of 3 series stainless steel and the relatively slow increment of spot resources dominant in the market are the two supports for the current volatile consolidation of nickel prices. However, these two points of support will not fully offset the weakness in stainless steel transactions and the expected increase in nickel pig iron supply. It is doubtful whether nickel prices have really bottomed out. Most operators believe that nickel prices may have entered a "plateau period" in the short term. But there are still downward concerns about the future.