SMM Views of Nickel Price Direction in March

On March 1, it was learned that NORNICKEL nickel products were banned in LME’s American warehouses, but SMM research showed that LME warehouses in the US had no substantial inventory, so it cast no impact on nickel prices.

On March 2, it was reported that NORNICKEL Nickel, the largest nickel producer in Russia, shipped goods to China in RMB. And the spot pricing method was based on prices of both the Shanghai Futures Exchange and the London Metal Exchange. Nickel futures prices fluctuated greatly. The pricing method of NORNICKEL Nickel was conducive to nickel prices to return to the influence of fundamentals. However, it is still necessary to pay attention to whether there are quantitative restrictions on the price of NORNICKEL nickel in RMB, the weight distribution of mixed pricing, and the regulations on the premium and discount.

On the whole, the Fed's interest rate hike cycle is still ongoing, and the current US CPI remains high. The possibility of a substantial interest rate hike in 2023 still exists. Even as the domestic electrowinning nickel output continues to increase, warrants and inventories have not posted any sharp growth. Domestic electrowinning nickel output is unlikely to surge until the fourth quarter, hence it is expected that the downside room for nickel prices may narrow in late March.