[SMM Nickel Midday Review] Nickel Prices Pulled Back on April 20 as Iran Threatened to Block Strait of Hormuz Again over US Violations

SMM Nickel News, April 20:

Macro and market news:

(1) Iran's foreign minister said last Friday that Iran opened the Strait of Hormuz to all commercial vessels during the ceasefire. However, starting the evening of April 18, Iran announced a renewed blockade of the Strait of Hormuz due to US violations, to remain in effect until the US lifts its blockade. No vessel transit was recorded through the Strait of Hormuz on April 19.

(2) NDRC: Accelerate the orderly deployment of 800 billion yuan in new-type policy-based financial instrument funds; focus on expanding effective domestic demand and formulate an implementation plan for the strategy to expand domestic demand from 2026 to 2030; this year will focus on areas such as "AI+" infrastructure to carry out a series of actions to expand effective investment.

Spot market:

On April 20, SMM #1 refined nickel prices fell 1,000 yuan/mt from the previous trading day. Spot premiums: Jinchuan #1 refined nickel averaged 1,750 yuan/mt, down 600 yuan/mt from the previous trading day; mainstream domestic electrodeposited nickel brands ranged from -600 to 600 yuan/mt.

Futures market:

The most-traded SHFE nickel 2605 contract rose in early trading before pulling back slightly, closing at 141,520 yuan/mt, down 0.88%.

The positive impact of Indonesia's nickel ore HPM new policy was phased in for digestion, and profit-taking by funds put nickel prices under correction pressure. However, the medium-term support logic for nickel prices remains solid. Going forward, attention should be paid to changes in actual transaction prices of Indonesian nickel ore and the impact of the US-Iran conflict on sulphur supply. The most-traded SHFE nickel contract price is expected to trade in the range of 140,000-150,000 yuan/mt.