This week (1.18-1.24), the nickel market did not continue its upward trend and was under pressure to decline. According to the monitoring of nickel prices by Shengyi Society, on January 24th, spot nickel was reported at 124516 yuan/ton, with a weekly decline of 3.53%.
Macro level: On January 21st, Trump stated that the US government is discussing imposing a 10% tariff on goods imported from China starting from February 1st, and previously stated that a 25% tariff may be imposed on Mexico and Canada starting from February 1st. It also promised to impose tariffs on European imported goods, but did not provide more details. The US dollar index remains above 108, putting pressure on non-ferrous metals.
Supply side: The Secretary General of APNI Indonesia stated that the total approved nickel ore mining work plan and budget (RKAB) for 2025 is 298.49 million tons. Currently, Indonesia’s nickel ore production accounts for 63% of the global total, which will lead to oversupply in the global nickel market. Regarding the previously discussed issue of reducing production, it was stated that the production cuts may be targeted at newly established enterprises. The Indonesian government is not implementing a significant contraction in the supply side, and the pattern of nickel surplus is difficult to change.
The surplus of pure nickel continues, and domestic and foreign inventories continue to accumulate. On January 24th, the inventory of Shanghai nickel warehouse receipts was 28320 tons, an increase of 762 tons during the week; On January 23rd, LME nickel inventory was 173064 tons, an increase of 5070 tons during the week.
On the demand side: At the end of the year, the market trading heat gradually weakened, demand weakened, stainless steel continued to accumulate inventory, and the market fluctuated at a low level. Attention should be paid to the resumption of work after the holiday.
Market forecast: oversupply, inventory pressure, weakened demand during the Spring Festival, and expected nickel prices to fluctuate in the low range.
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