Nickel has been doing Adou for nearly two years! I asked my friends around me, and I have already become numb to this breed. Not long ago, I suddenly found that there seems to be something unusual about Shanghai nickel this time!
The short-term disk is running strongly!
On Friday, the main Shanghai nickel contract closed at 134,450 yuan/ton, +1.17% from the pre-holiday period. LME nickel closed at $17,600 at 15 o'clock in March, -1.23% for the week.
In terms of nickel sulfate, the price of nickel sulfate was stable this week. At present, nickel sulfate maintains the cost pricing logic, the discount of intermediate products is still at a high level, the cost of nickel sulfate has risen in the context of rising nickel prices, and the price bottom support is still there. In terms of refined nickel, valuations continue to recover, and fundamentals have not changed significantly in the short term. In October, Indonesia's intermediate product production capacity was released significantly, and it is expected that the support on the cost side will be weakened, while the demand side has not been significantly improved, and the trend of refined nickel accumulation is still continuing.
What's wrong with nickel?
Since a series of macro benefits such as domestic RRR and interest rate cuts, many commodities have risen sharply. Despite the huge intraday swings, this bullish trend is valid!
In my opinion, it is possible that the Fed will not cut interest rates so quickly, and the equity market does not need to rise so fast. The huge fluctuations in the market are understandable. Especially for varieties that are greatly affected by domestic macro policies, you can remain optimistic about the long-term direction, but be cautious about the short-term rhythm.
What is unusual about nickel this time is that the price has broken through the downward trend of the past period of time, and it has also broken through the platform in form, and it seems that a bullish trend has been formed.
On the other hand, in terms of fundamentals, there is actually no big bright spot for nickel, and it is still weakly driven by low valuations. The macro boost has made a good start for nickel prices. The fundamentals are going to open up new or sudden variables, this understands everything!
Let's take a look at the fundamentals of nickel tangled
In terms of refined nickel, nickel prices fluctuated widely during the day, and the wait-and-see sentiment in the downstream heated up, and the overall transaction volume weakened compared with yesterday. In terms of inventory, LME nickel inventories were reported at 132372 tons, +522 tons from the previous day's inventory. On the cost side, the rainy season in the Philippines is approaching, and the downstream procurement of nickel ore is in a state of active preparation, and the price support of nickel ore still exists.
In terms of nickel sulfate, most of the salt plants have reduced production in the early stage, the inventory has been relatively reduced, the superimposed nickel price has continued to rise, and the cost has moved up, resulting in the inversion of the profit of the salt plant, and the price sentiment of the salt plant is strong, but the order increment of the downstream material plant is limited, the demand side is lacking momentum, the supply and demand sides are in a stalemate game stage, and the overall transaction of the market is cold.
What to look for in nickel and stainless steel?
In the short term, after the start of the Fed's interest rate cut, the market's expectations for a "soft landing" of the economy have increased, and macro sentiment has boosted nickel prices, and the market should pay close attention to United States economic data and further changes in the domestic macro. As for the fundamentals of nickel's weak driver and low valuation, we need to pay attention to some new changes, such as the Philippines and Indonesia, which we will mention for the time being.
Here we briefly mention ferronickel & stainless steel. On the supply side, production scheduling in September is still high, and the overall transaction in the demand-side market is flat, but the export performance is acceptable, and the stainless steel inventory is temporarily stable. On the cost side, Indonesian nickel ore has certain loose expectations, and the price of ferronickel fell slightly. However, the mining price will remain tight throughout the year, and the decline in the mining price is expected to be limited, and the cost support of ferronickel is still there. In October, we will observe whether the demand side can improve significantly.
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