SHANGHAI, Mar 12 (SMM) – Lower inventories of nickel are likely to support prices in the short term, given little pressure from imports from the Philippines and Indonesia, SMM expects. This is despite the modest rebound in consumption of stainless steel driven by high social inventories in Wuxi and Foshan.
SHFE nickel slumped on Thursday March 8 given high social inventories of stainless steel. Social inventories stood at about 400,000 mt, far above the level in the same period last year.
Following the pickup of LME nickel, SHFE nickel gained more than 4% over the weekend. This upward momentum carried on to Monday March 12. LME inventories dropped 0.6% on Friday March 9 while cancelled warrants rose 27%, the sharpest pickup in six years.
SMM expects nickel prices to face downward pressure at the end of the rainy season in March, and when nickel ore imports from the Philippines and Indonesia pick up.
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