Recent tightness in the spread of nickel prices should not be viewed as being driven by fundamentals, market participants said on Wednesday January 16, with falling physical nickel premiums representative of a well-supplied market.
The London Metal Exchange's cash/three-month nickel price spread closed at a $9 per tonne contango on January 15, the tightest since May 2014 and down from $84 per tonne at the beginning of this year.Cash/February and cash/March spreads both traded in backwardations on Tuesday, usually a sign of a lack of availability nearby.But tight spreads may not be a sign of any lack of availability of the metal right now, market...