SMM Nickel June 16 Update: Macro and market news: (1) The Bank of Japan raised its short-term policy interest rate from 0.75% to 1.0%, bringing it to the highest level in 31 years. The long-anticipated move signals its commitment to addressing inflation risks stemming from the Middle East conflict. (2) Iranian media: The US has begun lifting its maritime blockade, with multiple Iranian vessels passing through US-blockaded waters without incident. Spot market: On June 16, SMM #1 refined nickel spot prices fell by 500 yuan/mt from the previous trading day. For spot premiums, the average for Jinchuan #1 refined nickel was 1,500 yuan/mt, down 150 yuan/mt from the previous trading day, while mainstream domestic electrodeposited nickel brands ranged from -400 to 400 yuan/mt. Futures market: The most-traded SHFE nickel contract (2607) moved sideways in early trading. As of the morning session close, it was reported at 135,700 yuan/mt, up 0.27%. The finalized US-Iran deal has significantly eased geopolitical tensions in the Middle East, with the tail risk to energy supply receding. The pullback in crude oil has cooled global inflation expectations. If the reopening of the Strait of Hormuz eases the ex-China sulfur supply crisis, cost support for nickel prices will weaken. Meanwhile, nickel prices remain constrained by high inventories. In the near term, nickel prices are expected to trade in the range of 133,000-140,000 yuan/mt.

On June 16, SMM #1 refined nickel prices fell 500 yuan/mt from the previous trading day. In spot premiums, Jinchuan #1 refined nickel averaged 1,500 yuan/mt, down 150 yuan/mt from the prior day, while the range for mainstream domestic electrodeposited nickel brands was -400-400 yuan/mt.

SMM Nickel Jun 15 News: Macro and Market News: (1) As the Iran war neared the four-month mark, US-Iran peace talks achieved a breakthrough. The US, Iran, and key mediator Pakistan all indicated that an agreement had been reached and would be formally signed in Switzerland this Friday. (2) The People's Bank of China announced that on the 15th, it would conduct a 600 billion yuan outright reverse repo operation with a 6-month (183-day) tenor, using a fixed quantity, rate tender, and multiple-price auction method. Given that 600 billion yuan of this tenor matured during the month, this 6-month outright reverse repo operation was a full rollover. Spot Market: On Jun 15, SMM #1 refined nickel prices rose by 500 yuan/mt from the previous trading day. For spot premiums, Jinchuan #1 refined nickel averaged 1,650 yuan/mt, down 100 yuan/mt from the previous trading day, while the mainstream domestic electrodeposited nickel range was -500-400 yuan/mt. Futures Market: The most-traded SHFE nickel 2607 contract strengthened throughout the morning session, closing the morning at 136,120 yuan/mt, up 1.27%. The US and Iran reached a memorandum of understanding in Islamabad, extending the US-Iran ceasefire by 60 days. The Strait of Hormuz is about to reopen, and both sides have declared an end to hostilities and will formally sign the agreement this Friday. The recovering macro sentiment supported a collective rebound in non-ferrous metals prices; however, the extent of the nickel price rebound remained capped by inventory, with nickel prices expected to range between 133,000-140,000 yuan/mt.

On June 15, the SMM battery-grade nickel sulphate average price slightly rose.

On June 15, the SMM #1 refined nickel price increased by 500 yuan/mt from the previous trading day. Regarding spot premiums, the average Jinchuan #1 refined nickel was 1,650 yuan/mt, down 100 yuan/mt from the previous trading day, while the range for mainstream domestic electrodeposited nickel brands was -500 to 400 yuan/mt.

[SMM Analysis] Stainless Steel Off-Season Demand Combined with Macro Turbulence: Prices and Costs Pulled Back in Tandem, Narrowing Steel Mill Profits This week, stainless steel prices and production costs pulled back in tandem, slightly narrowing steel mill profit margins. Using 304 cold-rolled coil as the calculation benchmark, the profit margin based on current raw material costs was 2.23%, while the profit margin based on inventory raw material costs was 1.31%. On the nickel-based raw material cost side, high-grade NPI prices continued to pull back this week. Dragged down by the decline in SHFE nickel prices during the week, coupled with the heightened cost advantage of stainless steel scrap, expected production schedules at stainless steel mills dropped, reinforcing a strong desire to bargain down prices. High-priced transactions encountered resistance, keeping high-grade NPI prices in the doldrums. As of this Friday, mainstream 10%-12% grade high-grade NPI rose by 0.5 yuan per nickel unit, closing at 1,144 yuan per nickel unit. In the stainless steel scrap market, prices remained largely stable this week. The pullback in high-grade NPI prices caused the raw material side to weaken, making it difficult to drive prices upward. However, a rebound in stainless steel futures and limited declines in finished product spot prices provided a counterbalancing force that supported prices. The industry has now entered the off-season for consumption, with steel mill production schedules and profits both sliding. Combined with rising uncertainty in the macro environment, bearish risks are gradually accumulating, and prices are expected to face downward pressure going forward. As of this Friday, mainstream 304 off-cuts in the Shanghai region gained 100 yuan/mt, with the latest quotation at approximately 10,450 yuan/mt. On the chrome-based raw material cost side, high-carbon ferrochrome prices edged down this week. Chrome ore port inventories remained at historically high levels, and prices gradually pulled back, weakening the cost support for high-carbon ferrochrome. Additionally, ferrochrome producers still had profit margins at present, and production declines……