Nickel prices remain deadlocked after a slight increase this week

Price trend: (8.1-8.8)

According to the monitoring of the commodity market analysis system of Shengyi Society, on August 8th, spot electrolytic nickel was reported at 122316 yuan/ton, with a weekly increase of 0.96% and a year-on-year decrease of 4.64%. This week, nickel prices showed a trend of first rising and then remaining stagnant, mainly influenced by macroeconomic policy expectations and market sentiment fluctuations, while the lack of clear fundamental drivers maintained an overall volatile consolidation pattern.
Macro level:
Weak US economic data: In July, the US added only 73000 non farm payroll jobs, with an expected 104000, and the May June data was significantly revised down by 258000. The rising unemployment rate has intensified market concerns about an economic slowdown.
The expectation of Fed interest rate cuts has strengthened: San Francisco Fed’s Daley said that “two interest rate cuts within the year are still appropriate”, and the market expects a 25 basis point cut in September and December respectively. The expectation of loose liquidity provides support for base metals, but weak demand limits their gains.
Global trade friction escalates: Trump signs executive order to impose tariffs ranging from 10% to 50% on countries such as India, Canada, and Brazil, further exacerbating market risk aversion.
Sustained domestic policy support: China’s third batch of 69 billion yuan of special treasury bond funds for trade in consumer goods has been released, and the fourth batch will be released in October. The annual 300 billion yuan fund plan is steadily advancing. The conference and the ‘anti internal competition’ policy boosted market confidence, with clear bottom support.
China’s July trade data exceeded expectations, but the global manufacturing PMI of 49.3% (contracted for two consecutive months) and the Asian manufacturing PMI of 50.5% slowed down, reflecting that the global economic recovery is still unstable.
Supply side:
Nickel ore price: The benchmark price for domestic trade of Indonesian nickel ore in the first cycle of August was $15028.33 per dry metric ton, an increase of 0.69% compared to the second cycle of July. The price of nickel ore in the Philippines remains stable, with an increase in port arrivals.
Inventory changes: Domestic Shanghai nickel inventory decreased by 1084 tons to 20621 tons during the cycle, while LME nickel inventory increased by 3540 tons to 212232 tons during the cycle. The global inventory surplus pattern has not changed, suppressing the upward space for prices.
Demand side:
Stainless steel is facing certain production reduction expectations, weak support for nickel demand, and high inventory and weak demand problems still exist. On August 7th, the benchmark price of stainless steel was 13100 yuan/ton, with a weekly increase of 0.15%.
New energy demand: The demand for nickel in the field of ternary precursors and batteries remains stable and has not shown significant growth.
Future outlook:
Macro led short-term trend: Expectations of Federal Reserve interest rate cuts and the trend of the US dollar remain key variables. If the September interest rate cut is implemented, nickel prices may rise slightly supported by liquidity. But the escalation of trade frictions may exacerbate market volatility and limit gains. The fundamentals are still weak: there is still excess pressure on the supply side, and there is no strong driving force in the stainless steel and new energy sectors on the demand side. The upward space for nickel prices is limited.