Nickel up as Nickel Ore Inventories Across all Chinese Ports Decreased 432,000 WMT

  • Commodities Analysis

Nickel Futures yesterday settled up by 0.76% at 1354.9 as nickel ore inventories across all Chinese ports decreased 432,000 wmt from Jun 4 to 5.51 million wmt. Data also showed that nickel ore stocks across seven major Chinese ports decreased 492,000 wmt during the same period to 3.78 million wmt. Nickel ore inventories dropped significantly this week. Shipments in the Philippines declined due to the weather, and the output of domestic ferronickel plants increased slowly with rising demand for nickel ore, which accounted for the decrease in stocks. Inventories of refined nickel in the Shanghai bonded areas remained unchanged from a week ago and stood at 9,700 mt as of June 11, showed data.
German output is rebounding from its pandemic-induced slump and inflation could rise faster than currently expected, potentially affecting behaviour in the economy, the German central bank said. The national refined nickel output decreased 590 mt or 4.53% month on month to 12,400 mt in May, and operating rates stood at 57%. Among them, Gansu smelter carried out an overhaul of the top-blowing furnace, but maintained the overall normal production, with the affected output within 1,000 mt.
Technically market is under fresh buying as the market has witnessed a gain in open interest by 15.36% to settled at 1825 while prices up 10.2 rupees, now Nickel is getting support at 1341.1 and below same could see a test of 1327.4 levels, and resistance is now likely to be seen at 1364.2, a move above could see prices testing 1373.6.
Trading Ideas: 
# Nickel trading range for the day is 1327.4-1373.6.
# Nickel gained as nickel ore inventories across all Chinese ports decreased 432,000 wmt from Jun 4 to 5.51 million wmt
# Prices have been pushed up by stronger demand from the nickel-based stainless steel market in China and from the EV industry.
# Nornickel projects a 2021 market surplus of 52,000 tonnes, sharply below its prior forecast of 90,000 tonnes.

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