Newsletter summary
The price of nickel in Shanghai went up and fell slightly by 0.Arcadecenter.44%, the progress of RKAB in Indonesia has caused market fluctuations, and global refined nickel stocks have increased slightly.ArcadecenterStainless steel futures rose 1.88% this week, market inventories declined slightly, and the contradiction between supply and demand may lead to long-term price shocks.
Text of news flash
[Shanghai nickel prices rose and fell, hitting a new high this week.] in the trading week on May 24, the Shanghai nickel market was significantly volatile, with the opening price of 2406 of the main contract at 155010 yuan / ton, while the closing price fell slightly to 152780 yuan / tonne, down 0.44% from the previous week. In the middle of the week, the price hit a high of 160500 yuan per ton, setting a new record for the year, but the lowest price fell to 150530 yuan per ton on Friday.
[macroeconomic impact on nickel price fluctuations, supply and demand dynamics urge market attention] Macroeconomic factors have had a significant impact on nickel prices, especially at the beginning of the week, geopolitical turmoil in the Middle East led to a general rise in non-ferrous metals. The subsequent release of strong economic data in the United States dampened market expectations of interest rate cuts. In terms of fundamentals, the progress of the RKAB project in Indonesia has had a certain impact on the trend of nickel prices, although the market has not had a better-than-expected response to the update of RKAB, tight expectations of nickel mines still exist and provide some support for nickel prices. However, market expectations for an increase in nickel tradable capacity are gradually heating up, while the prospect of nickel product overcapacity remains unchanged in the second half of the year.
[China's electrolytic nickel production remains high, the supply side remains high] domestic electrolytic nickel production remains high, and the spot supply of refined nickel in the market is still abundant. The accumulation of social inventory shows that the supply of pure nickel continues to be high in the short term. According to SMM data, Jinchuan nickel's rising water price has risen by 25 yuan per ton, while Russian nickel's rising water price has declined. In addition, both Shanghai Nickel and LME Nickel inventories have increased, indicating a small increase in global explicit inventory of refined nickel.
[nickel oversupply continues, prices are supported by costs] China's refined nickel production continues to grow, and nickel supply remains stable at a high level, but there is no obvious sign of improvement on the consumer side, resulting in a continued surplus. Both domestic inventory and LME inventory are accumulating. At present, refined nickel inventory in China has reached a high level of nearly two years. The recent increase in instability in mine-side supply, in particular the slow mine-side approval process in Indonesia, coupled with problems with the supply of nickel mines in New Caledonia and Australia, has led to a rise in nickel prices. Cost-end nickel sulfate prices remain high, nickel prices are expected to show a volatile trend in the short term.
[stainless steel market fluctuated upward, but demand did not pick up significantly] in the same week, stainless steel futures prices showed a volatile upward trend, the main contract 2409 rose from 14400 yuan / ton to 14640 yuan / ton, an increase of 1.88%. Although the rising prices of raw materials and steel mills have provided support for the market, and traders have raised spot prices one after another, the willingness to prepare stocks downstream has not significantly warmed up. Although there has been a slight decline in market inventories, the upward momentum has shown greater pressure after the closing of positions by various forces, and the market is expected to run weakly in the coming week and return to fundamentals.
[stainless steel inventory pressure, supply high demand is weak] 304 stainless steel is currently facing greater inventory pressure, the supply remains high, while the demand side is weak. Domestic stainless steel production rebounded to a high level in April, but the performance of terminal consumption was relatively weak, and the inventory removal process was delayed due to lagging demand. Although the profits of stainless steel plants and nickel-iron plants have been repaired, the phenomenon of cost inversion has not been completely eliminated, which provides a certain degree of support to the price of stainless steel. The impact of macro sentiment is gradually weakening, and stainless steel prices may return to the weak operation of fundamental shocks in the short term.
[risk factors need to pay attention to Indonesian policy changes and supply-side disturbances] risk factors that investors in the nickel and stainless steel markets need to pay attention to include changes in Indonesian policy and supply-side disturbances, such as nickel supply in New Caledonia and Australia. All these factors may have an impact on the price of nickel and stainless steel.
