SMM Nickel Market Morning Comment Fully (Apr 11)

On Wednesday, the most-traded SHFE nickel contract opened at 138,500 yuan/mt, and closed at 139,680 yuan/mt, up 2,590 yuan/mt compared with the last trading day. Trading volume increased by 50,757 lots to 273,596 lots, and open interest decreased by 4,150 lots to 81,592 lots. The most-traded SHFE nickel contract fluctuated sideways after initial slight drop. In the afternoon, it fell sharply to the lowest at 137,950 yuan/mt, and then rebounded, with the final increase of 1.93%.

Nickel: On April 10th, Jinchuan quoted a premium of 2,000-2,500 yuan/mt, averaging 2,250 yuan/mt, down by 300 yuan/mt compared to the previous trading day. Norilsk Nickel quoted a premium of -500 to -200 yuan/mt, averaging -350 yuan/mt, unchanged. SHFE nickel showed strong performance in the morning, with an overall stability in the spot market. The price of nickel briquette today was 135,800-136,500 yuan/mt, up by 3,300 yuan/mt compared to the previous trading day, rresulting in a price difference that nickel sulfate price is 2,032 yuan/mt higher than nickel briquette price.

Nickel Sulfate: On April 10th, the SMM battery-grade nickel sulfate index price was 30,341 yuan/mt, down by 53 yuan/mt from the previous working day, with a price range of 30,200-30,600 yuan/mt, down by 100 yuan/mt on average from the previous working day. Current trading activity is low, with a lower trading concentration. Downstream acceptance of high-priced nickel sulfate is gradually decreasing, and transactions on some low-grade have been made. The main reason is that some nickel salt factories have offered low-price sales, but there has been no large-scale occurrence yet. The overall trading price range is shifting downwards, with a wait-and-see attitude prevailing in the market.

Ferronickel: On April 10th, the average price of SMM 8-12% high NPI was 931.5 yuan/mtu (factory tax included), up by 0.5 yuan/mtu from the previous working day. From the supply side, in April, nickel ore prices remained high, but Indonesian ferronickel smelters did not significantly reduce production. Affected by the inverted profit margin, some small and medium-sized domestic enterprises began to shut down, with the resumption time still under observation. After the Qingming Festival, market sentiment warmed, with stainless steel prices fluctuating upwards. However, the upstream and downstream of ferronickel are still in a stalemate, and prices remain stable. From the demand side, there were a small amount of transactions at steel mills after the holiday, with lower prices and relatively light transactions. SHFE nickel and stainless steel main contracts fluctuated upwards, with upstream quotations rising slightly and more downstream observation. Overall, the expected production of stainless steel remains high, leading to relatively ample supply, and it is expected that the current ferronickel prices will have limited downward space under cost support.

Stainless Steel: On April 10th, according to SMM research, spot transactions in the stainless steel market were relatively light today. Boosted by the upward trend in stainless steel futures, there was a decrease in low-priced resources for 300 series cold-rolled, while high prices were still maintained with steel mill price restrictions. Some traders in Foshan strengthened their price support, with significant upward explorations. Hot-rolled prices increased more, with both Wuxi areas rising by about 100 yuan/mt. Meanwhile, the quotation for 201 series was also adjusted upward under the influence of the 300 series atmosphere. Currently, the market sentiment is relatively positive, and stainless steel spot prices remain stable. In the morning, 304 cold-rolled in Wuxi was reported at 13,700-13,900 yuan/mt, 304 hot-rolled in Wuxi was reported at 13,150-13,250 yuan/mt. 316L cold-rolled in Wuxi was reported at 23,800-24,000 yuan/mt. 201J1 cold-rolled in Wuxi was reported at 8,750-8,850 yuan/mt. 430 cold-rolled in Wuxi was reported at 8,100-8,200 yuan/mt. At 10:30 am, the SHFE SS2405 contract price was 13,765 yuan/mt, with a premium of 105-375 yuan/mt for stainless steel spot in Wuxi. (Spot deburred edge = Burr edge + 170 yuan/mt).