1、 Trend analysis

According to the monitoring of nickel prices by the Business Society, nickel prices have been fluctuating this week. As of October 13th, the spot nickel quotation was 153750 yuan/ton, an increase of 0.44% from the beginning of the week and a year-on-year decrease of 19.79%.

According to the weekly rise and fall chart of Business Society, in the past 12 weeks, nickel prices have decreased by 8% and increased by 3%, with a recent wide fluctuation trend in nickel prices.

Nickel industry chain

On the macro level, the US CPI rose by 3.7% year-on-year in September, higher than expected, marking the third consecutive month of rebound; The core CPI dropped from 4.3% last month to 4.1%, the smallest increase in nearly two years, but still above 4%, far above the Federal Reserve’s target level of 2%. This also highlights the stubbornness of inflation, and the market expects the Federal Reserve to raise interest rates again, which also brings uncertainty to the final results of interest rate negotiations in November and December; On the domestic side, the issuance of local government refinancing bonds has accelerated, boosting market confidence.

In terms of supply: Indonesia has increased production capacity for intermediate products and nickel plates, and domestic pure nickel supply is sufficient, resulting in a slowdown in market inventory consumption. In September 2023, the national refined nickel production reached a total of 22100 tons, an increase of 1.4% month on month and 43.18% year on year. The increase in production was mainly affected by the continuous increase in newly added electrolytic nickel production and the continuous increase in production of a certain smelter in northwest China. It is expected that the national refined nickel production in October will reach 22800 tons, a month on month increase of 2.94% and a year-on-year increase of 48.05%.

In terms of demand: The total social inventory of stainless steel this week was 1.1278 million tons, a decrease of 3.34% compared to the previous week. All departments have varying degrees of digestion. The high inventory of nickel iron in the raw material end combined with a significant increase in imports has led to a slight decrease in prices. Recently, the price of nickel ore in the Philippines has been lowered, and support will be weakened. In terms of new energy vehicles, some battery and material factories still have varying degrees of reduction in production compared to the previous month, suppressing the demand for nickel sulfate.

In summary, the domestic nickel supply is loose, the expected reduction in stainless steel production leads to price increases, LME inventory is depleted, and spot trading has slightly improved. Nickel prices are expected to maintain a broad and volatile trend.