This week, domestic spot nickel prices in China displayed a V-shaped pattern, initially rising before falling, with premiums eroding to zero and the overall price center moving lower. The average price for Yangtze spot 1# nickel was reported at 140,750 yuan per tonne on June 8. It then declined for three consecutive days, hitting a low of 134,700 yuan per tonne on June 11, a cumulative drop exceeding 6,000 yuan per tonne. A rebound of 1,800 yuan on June 12, driven by inventory replenishment demand, brought the average price to 136,500 yuan per tonne. However, the weekly average price still fell compared to the start of the period, with a total weekly decline of 570 yuan per tonne. The weekly average for Yangtze spot 1# nickel was 137,170 yuan per tonne. Market sentiment showed slight improvement after short-term pressure, with intensified competition between supply-demand dynamics and macro factors.
Internationally, the week began with Iran's strike on Israel, causing a 3% spike in oil prices and igniting safe-haven demand, with the DXY index rising 0.6% to break above 100, reaching a two-month high. Mid-week, panic escalated: U.S. non-farm payrolls for May at 172,000 far exceeded expectations, sending the probability of a rate hike before December soaring past 70%. The Nasdaq plunged 4.2% and a semiconductor index crashed 10%, dragging global tech stocks lower. The week ended with a dramatic reversal—former President Trump first threatened "heavy bombing," only to announce a cancellation of strikes hours later, citing a "great deal." The U.S.-Iran ceasefire was extended by 60 days, with the Strait of Hormuz set to reopen. On the same day, U.S. May CPI hit 4.2% year-on-year, a near three-year high, causing the DXY to retreat to the 99 level. U.S. stocks staged a strong rebound: Nasdaq +2.54%, Dow Jones +1.86%, and the semiconductor index surged 8%. Domestically, regulatory tightening in the auto industry led to a sudden cooling of demand expectations. Authorities jointly interviewed automakers to curb irrational price-cutting competition. While beneficial for healthy industry development in the short term, the cooling price war implies reduced promotional efforts, raising market doubts about short-term sales growth for new energy vehicles—pressuring demand expectations for nickel sulfate, a core material for ternary batteries. May export data showed resilience, and a communications technology test satellite was successfully launched. The State Council deployed audit rectifications, and pre-Dragon Boat Festival consumption and civil aviation bookings showed signs of recovery. The nickel price—briefly reclaiming the 138,000 yuan level before falling back—ended the week near where it started, with Yangtze spot 1# nickel falling from above 138,000 yuan to around 134,000 yuan. Three pressures converged: ① The U.S.-Iran agreement dissipated the Hormuz crisis, rapidly eroding geopolitical premiums; ② Oil prices plunged from $94 to $85, collapsing the energy cost support for nickel smelting; ③ GEM's capacity fully recovered, the PT HPAL project reached full production of 185,000 tonnes, new nickel sulfate projects progressed, and Indonesian miners accelerated shipments to exchange for foreign currency amid the rupiah's depreciation, leading to a concentrated supply surge.
In-Depth Look at the Nickel Supply Chain: Multiple Supply Sources and a Looming Retirement Wave
This week, the nickel supply chain was mixed with clear supply divergence. On the ore front: Indonesia linked nickel ore quotas flexibly to international spot prices, with continued signals of policy loosening. The mining minister indicated possible relaxation of quotas, increasing market expectations for supply and creating headwinds for nickel demand. A strong earthquake in Mindanao, Philippines, caused mine shipment suspensions, disrupting the arrival schedule for laterite nickel ore. For intermediates: Soaring sulfur prices forced several MHP smelters to halt for maintenance, unexpectedly tightening supply. The conversion progress for nickel matte fell short of expectations, limiting incremental supply. Recycled nickel was suppressed by low prices, with the recycling system operating sluggishly. The overall supply chain presented a pattern of "frequent ore-side disruptions, structural shortages in intermediates, and tepid end-user demand," with supply-side uncertainty becoming the core variable for short-term nickel prices.
Weekly Nickel Demand: Stainless Steel Weakness, Ternary Batteries a Lone Support
This week, nickel demand was characterized by a "deep seasonal slump and dual domestic and international pressure." Stainless steel led the decline: Wuxi 300-series futures fell below 14,800, with shrinking nickel pig iron procurement dragging down demand for laterite nickel ore. Steel mills showed a clear intention to push down prices. Ternary precursor production maintained growth, but the expanding market share of lithium iron phosphate (LFP) batteries led to a marginal decline in nickel demand intensity. Nickel sulfate producers purchased based on orders, avoiding bulk inventory replenishment. Nickel-dissolution line operations were stable with no increase, and sulfide nickel ore supply increments were limited. Nickel matte and MHP maintained rigid demand supported by downstream smelting capacity expansion, representing a rare structural bright spot. Recycled nickel circulation remained sluggish, suppressed by low prices. Three overseas headwinds converged: Indonesia's mining minister signaled quota relaxation, strong U.S. jobs data boosted rate hike expectations, suppressing overseas procurement, and slowing new energy vehicle sales growth in Europe dragged on marginal demand for ternary nickel, making it difficult to reverse the short-term seasonal weakness.
From June 8 to 12, the price for battery-grade nickel sulfate in the Yangtze spot market showed a continuous weakening trend, with the average price falling from 34,050 yuan per tonne to 33,750 yuan per tonne. The weekly average was 33,930 yuan per tonne, down 60 yuan week-on-week. The core factors were weak downstream procurement demand, low inventory willingness among ternary precursor producers, coupled with bearish macro expectations, resulting in thin market trading. Nickel sulfate prices came under pressure alongside the decline in nickel prices.
This week, prices for electrolytic nickel plate in the comprehensive Yangtze market showed an initial decline followed by a slight recovery, with the overall price center moving lower. The average price started the week at 140,800 yuan per tonne, then fell for three consecutive days to a low of 135,700 yuan per tonne, before a small rebound on Friday to 136,700 yuan per tonne. The weekly average was 137,580 yuan per tonne, down 580 yuan week-on-week. Main inducing factors: First, macro headwinds dominated, with stronger-than-expected U.S. inflation data delaying rate cut expectations and a stronger dollar suppressing metal valuations. Second, weak supply-demand fundamentals, with sluggish procurement in the traditional off-season for stainless steel and new energy nickel demand growth falling short of expectations, coupled with inventory accumulation pressure. Third, short-term sentiment repair, with downstream bargain-hunting on Friday driving a small price rebound, but the lack of substantial improvement in demand casts doubt on the sustainability of the rebound.
LME Nickel Inventory Rises Then Falls, Supply-Demand Imbalance Drives Short-Term Trend
LME nickel inventory showed a pattern of rising then falling this week, hitting a阶段性高点 of 274,848 tonnes on June 9 before rapid destocking brought it down to 274,152 tonnes by June 11. Short-term fluctuations stemmed from changes in warrant delivery节奏, while the underlying pressure came from a global nickel market supply-demand imbalance: Continued release of Indonesian nickel capacity brought supply increments, coupled with demand from stainless steel and new energy batteries falling short of expectations. High visible inventories suppressed price flexibility, with the short-term market remaining in a surplus格局, and the destocking process proceeding slowly.
Macro Winds Stir, Nickel Prices Waver | With the Dragon Boat Festival Approaching, Where is the Metal Market Headed?
Recent overseas inflation data exceeding expectations has significantly cooled Federal Reserve rate cut expectations. A stronger dollar, combined with Middle East geopolitical disturbances, slowing domestic economic recovery in China, weak end-user demand for stainless steel, and持续 inventory accumulation have created multiple headwinds dragging nickel prices lower. From June 8 to 12, LME nickel fell over 4%, with Yangtze spot nickel prices同步下行, maintaining an overall weak震荡格局.
Short-term market focus is on U.S. PPI data, changes in the Middle East situation, and domestic pre-holiday stockpiling ahead of the Dragon Boat Festival. Looking ahead to next week (June 15-19), with only four trading days and exchanges closed for three days starting June 19 for the festival, pre-holiday capital博弈 is expected to intensify. Nickel prices are likely to seek a bottom through weak震荡.
Overseas,密集 commentary from Fed and ECB officials, along with geopolitical conflicts and dollar movements, will remain core influencing factors. Domestically, May economic data, the pace of pro-growth policy implementation, and the holiday market closure will also sway market sentiment. Regarding the price outlook, nickel is expected to seesaw between macro headwinds and cost support. The Yangtze spot nickel price is forecast to trade within a range of 133,000-139,000 yuan per tonne, with LME nickel波动 between $17,500-$18,900. A narrow-range consolidation is highly likely before the market closure. Trading advice suggests light position trading within the range, with short buys依托成本 at lower levels and opportunistic shorting when encountering resistance at higher levels. It is essential to reduce positions before the Dragon Boat Festival to规避 holiday uncertainty.
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