Abstract The monthly summary of metal prices in May shows that nickel was particularly volatile, largely influenced by short selling pressure and the strength of the U.S. dollar index. As we move into June, a gradual rebound in nickel prices is anticipated, with the main trading range expected to be between 15,000 and 16,000 USD/ton. This outlook is supported by key events such as the China Urbanization Conference in mid-June and the upcoming FOMC meeting on June 19–20.
January and May Nickel Price Trends
In May, LME nickel prices remained at a low level, starting from around $18,800/ton in February and dropping to $15,100/ton by the end of April, marking a nearly 20% decline. At the start of May, prices fell further to about $15,000/ton before stabilizing within a narrow range of 14,561–15,406 USD/ton. The volatility during the month was minimal, with a price swing of less than $1,000/ton.
Macroeconomic conditions globally were relatively stable in May. The U.S. economy continued its steady recovery, while China’s economic recovery remained weak. The Eurozone faced signs of stagnation and potential recession. Despite this, stock markets in Europe and the U.S. saw continued gains, and the U.S. dollar index surged strongly.
Throughout the month, the metal market was dominated by short positions, with significant profits accumulated. There were concerns about Chinese companies potentially entering the market to buy at lower levels. These factors contributed to a slight rebound in metal prices, especially in copper. However, the strong U.S. dollar continued to put downward pressure on global commodities.
On the supply side, LME nickel inventories rose sharply in May, reaching over 180,000 tons, an increase of 3,500 tons for the month. While the inventory growth slowed compared to previous months, it still signaled a surplus in the market.
Domestic Spot Nickel Market in May
In the domestic market, Jinchuan nickel plate prices dropped significantly, falling to 14,500 yuan/ton. In the Shanghai market, Jinchuan nickel traded between 104,300–108,000 yuan/ton, while Russian nickel ranged from 103,300–107,000 yuan/ton, with a spread of about 3,500 yuan/ton. Prices fluctuated throughout the month, with a peak of 108,000 yuan/ton following a small rebound in LME nickel prices.
According to customs data, China imported 148,300 tons of unwrought nickel in April, showing a moderate increase compared to previous months. Domestic electrolytic nickel production remained stable, and demand from downstream stainless steel plants did not change significantly. Overall, the domestic nickel market remained well-supplied.
Nickel Pig Iron and Laterite Nickel Ore Market in May
Domestic nickel pig iron prices also stayed low, reflecting the weakness in LME nickel. The expansion of rotary kiln projects increased supply and reduced production costs. By the second half of the month, nickel pig iron prices weakened further as stainless steel mills lowered their bids.
Laterite nickel ore prices followed LME nickel closely, maintaining a sideways trend at the beginning of the month. Imports in April dropped to 49.3 million tons, down from 55.28 million tons in March, but still showed a year-on-year increase. Inventory levels in major ports reached 21.4 million tons by mid-May and settled around 21 million tons by the end of the month.
Outlook for June: A Rebound in Nickel Prices
After a period of consolidation, we are cautiously optimistic about a stronger upward trend in nickel prices in June, with the main trading range expected to be between 15,000 and 16,000 USD/ton. Two key factors are driving this expectation: the progress of China’s new urbanization policy and expectations around the Fed’s June FOMC meeting.
While China's economic recovery remains weak, the focus on urbanization and structural reforms continues to attract market attention. Although these policies may not directly boost metal demand, they can improve investor sentiment and support risk assets. Meanwhile, the Fed’s upcoming meeting has sparked speculation about potential shifts in monetary policy. While no clear signals are expected from the June meeting, the central bank’s stance could provide some support to the market.
Overall, the combination of macroeconomic stability, policy developments, and market sentiment suggests that nickel could see a more defined upward movement in the coming weeks.
January and May Nickel Price Trends
In May, LME nickel prices remained at a low level, starting from around $18,800/ton in February and dropping to $15,100/ton by the end of April, marking a nearly 20% decline. At the start of May, prices fell further to about $15,000/ton before stabilizing within a narrow range of 14,561–15,406 USD/ton. The volatility during the month was minimal, with a price swing of less than $1,000/ton.
Macroeconomic conditions globally were relatively stable in May. The U.S. economy continued its steady recovery, while China’s economic recovery remained weak. The Eurozone faced signs of stagnation and potential recession. Despite this, stock markets in Europe and the U.S. saw continued gains, and the U.S. dollar index surged strongly.
Throughout the month, the metal market was dominated by short positions, with significant profits accumulated. There were concerns about Chinese companies potentially entering the market to buy at lower levels. These factors contributed to a slight rebound in metal prices, especially in copper. However, the strong U.S. dollar continued to put downward pressure on global commodities.
On the supply side, LME nickel inventories rose sharply in May, reaching over 180,000 tons, an increase of 3,500 tons for the month. While the inventory growth slowed compared to previous months, it still signaled a surplus in the market.
Domestic Spot Nickel Market in May
In the domestic market, Jinchuan nickel plate prices dropped significantly, falling to 14,500 yuan/ton. In the Shanghai market, Jinchuan nickel traded between 104,300–108,000 yuan/ton, while Russian nickel ranged from 103,300–107,000 yuan/ton, with a spread of about 3,500 yuan/ton. Prices fluctuated throughout the month, with a peak of 108,000 yuan/ton following a small rebound in LME nickel prices.
According to customs data, China imported 148,300 tons of unwrought nickel in April, showing a moderate increase compared to previous months. Domestic electrolytic nickel production remained stable, and demand from downstream stainless steel plants did not change significantly. Overall, the domestic nickel market remained well-supplied.
Nickel Pig Iron and Laterite Nickel Ore Market in May
Domestic nickel pig iron prices also stayed low, reflecting the weakness in LME nickel. The expansion of rotary kiln projects increased supply and reduced production costs. By the second half of the month, nickel pig iron prices weakened further as stainless steel mills lowered their bids.
Laterite nickel ore prices followed LME nickel closely, maintaining a sideways trend at the beginning of the month. Imports in April dropped to 49.3 million tons, down from 55.28 million tons in March, but still showed a year-on-year increase. Inventory levels in major ports reached 21.4 million tons by mid-May and settled around 21 million tons by the end of the month.
Outlook for June: A Rebound in Nickel Prices
After a period of consolidation, we are cautiously optimistic about a stronger upward trend in nickel prices in June, with the main trading range expected to be between 15,000 and 16,000 USD/ton. Two key factors are driving this expectation: the progress of China’s new urbanization policy and expectations around the Fed’s June FOMC meeting.
While China's economic recovery remains weak, the focus on urbanization and structural reforms continues to attract market attention. Although these policies may not directly boost metal demand, they can improve investor sentiment and support risk assets. Meanwhile, the Fed’s upcoming meeting has sparked speculation about potential shifts in monetary policy. While no clear signals are expected from the June meeting, the central bank’s stance could provide some support to the market.
Overall, the combination of macroeconomic stability, policy developments, and market sentiment suggests that nickel could see a more defined upward movement in the coming weeks.
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