While upstream MHP payables stayed high, auxiliary material prices such as sulphur and sulphuric acid continued to climb, and downstream ternary production schedules remained at high levels, the performance of battery-grade nickel sulphate prices was not optimistic. SMM believes this was driven by multiple factors, including weakening cost support, front-loaded downstream stockpiling, increased import supplementation, and higher volumes of nickel sulphate converted from refined nickel.

SMM Nickel, June 12: Macro and Market News: (1) Hours after Trump announced he would bomb Iran again, Trump stated that, given the consultation results with Iran have been approved by Iran’s top leadership, the strike on Iran tonight is canceled. The US-Iran agreement has entered the finalization stage and is expected to be signed in Europe this weekend. (2) The European Central Bank raised its three key interest rates by 25 basis points as expected, marking the first hike in nearly three years. ECB President Lagarde stated that today’s decision is not an aggressive move, and the 25-basis-point hike serves as a signal. Spot Market: On June 12, SMM #1 refined nickel price rose by 900 yuan/mt from the previous trading day. Regarding spot premiums, Jinchuan #1 refined nickel averaged 1,750 yuan/mt, up 400 yuan/mt from the previous trading day, while domestic mainstream brand electrodeposited nickel premiums ranged from -500 to 400 yuan/mt. Futures Market: The most-traded SHFE nickel 2607 contract rebounded in early trading, closing the morning session at 135,370 yuan/mt, up 0.94%. US CPI exceeded expectations, fueling rate hike expectations, and the world entered a monetary tightening window. On the Indonesia side, the premium accumulated earlier due to ore scarcity is being corrected. China’s refined nickel inventory has reached a historic high, and domestic inventory continues to increase. Visible inventory pressure has not been fundamentally alleviated, and nickel prices are under pressure in the short term.

SMM nickel June 11 news: Macro and market news: (1) The US-Iran conflict reignites; at 17:15 ET on June 10, US Central Command forces carried out "self-defense strikes" against multiple targets in Iran in response to Iran's "unprovoked and sustained" attacks; Iran's Armed Forces Khatam al-Anbiya Central Headquarters announced the closure of the Strait of Hormuz, sending international oil prices higher. (2) On Wednesday local time, data released by the US Department of Labor showed that US May CPI inflation was broadly in line with market expectations, but driven by a sharp rise in oil prices due to the Middle East war, the May CPI accelerated on a monthly basis, increasing price pressure on consumers and further reinforcing the case for the Fed to keep interest rates high and remain on hold for longer. Spot market: On June 11, the price of SMM #1 refined nickel fell 750 yuan/mt from the previous trading day. In terms of spot premiums, the average premium for Jinchuan #1 refined nickel was 1,350 yuan/mt, up 200 yuan/mt from the previous trading day; premiums for domestic mainstream brand electrodeposited nickel ranged from -500 to 400 yuan/mt. Futures market: The most-traded SHFE nickel 2607 contract continued to slide sharply during the session, dipping to 134,000 yuan/mt, and closed the morning session at 133,370 yuan/mt, down 1.49%. US CPI came in higher than expected, bolstering rate hike expectations and pushing the world into a monetary tightening window; on the Indonesia side, the premium previously built up due to ore scarcity is being corrected; China's refined nickel inventory has hit a record high and continues to increase, visible inventory pressure has not been substantively eased, and nickel prices remain under pressure in the short term.

SMM June 8 – SMM Nickel: Macro and Market News: (1) US non-farm payrolls increased by 172,000 in May, beating expectations, while job gains for March and April were revised up by a combined 93,000. The market is fully pricing in a 25bp rate hike by the US Fed before year-end. (2) The PBOC increased gold reserves for a 19th consecutive month, up 320,000 ounces MoM; China’s foreign exchange reserves rose to $3,442.2 billion at the end of May. Spot Market: On June 8, SMM #1 refined nickel price rose 1,400 yuan/mt from the previous trading day. In terms of spot premiums, Jinchuan #1 refined nickel averaged 1,000 yuan/mt, up 50 yuan/mt from the previous trading day, while electrodeposited nickel from mainstream domestic brands ranged from -600 to 400 yuan/mt. Futures Market: The most-traded SHFE nickel 2607 contract edged higher in early trading and closed the morning session at 139,830 yuan/mt, up 0.79%. US non-farm payrolls data beat expectations, fueling rate hike bets; the US dollar strengthened, weighing on risk assets. Global visible refined nickel inventory stood at around 390,000 mt, and China continued to see inventory buildup. Nickel prices faced resistance. However, the supply of sulfur, an auxiliary material for intermediate products, remained tight, and MHP production cuts have not been resumed. Strong cost support at the bottom remains. The most-traded SHFE nickel contract is seen trading in a range of 137,000-145,000 yuan/mt.

Nickel prices were generally in the doldrums this week. The most-traded SHFE nickel contract moved sideways within the 142,000-147,000 yuan/mt range, pulling back after attempting to test resistance at overhead moving averages. The main bearish factors came from continued inventory buildup, which suppressed bullish sentiment. Wait-and-see sentiment was prevalent in the market, with no clear unidirectional driver. LME nickel prices were similarly in the doldrums within the $18,300-19,000/mt range. Spot market side, the weekly average price of SMM #1 refined nickel was 143,510 yuan/mt, up 350 yuan/mt WoW. Jinchuan nickel premiums remained at 1,000-1,400 yuan/mt this week. Domestic mainstream electrodeposited nickel premiums stayed in the -500-500 yuan/mt range, with no significant change from last week. Spot market transactions returned to a sluggish state this week, mainly because end-users had actively stockpiled during the previous sharp decline in nickel prices. With futures moving sideways this week, downstream willingness to price against futures was low, with just-in-time procurement being the dominant mode. On the macro front, Fed Chairman transition was completed this week, with new Chairman Waller officially taking office. Market expectations for US Fed interest rate cuts were pushed back to H2 2027, with the possibility of rate hikes not ruled out. Meanwhile, the 10-year US Treasury yield remained in the elevated range of approximately 4.35%-4.45% this week, and the US dollar index stayed strong, continuing to weigh on non-ferrous commodity prices. Inventory side, Shanghai Bonded Zone inventory was approximately 1,700 mt this week, flat WoW. Domestic social inventory was approximately 113,000 mt, with an inventory buildup of approximately 1,100 mt WoW. Currently, bullish and bearish forces are balanced, with continued refined nickel inventory buildup being the core factor suppressing nickel prices. In the short term, absent new catalysts, nickel prices are expected to continue moving sideways with wild swings within the 140,000-150,000 yuan/mt range.

Rumored NPI production cuts at one of Indonesia's largest nickel hubs reveal a deeper structural shift — and a stark gap in per-megawatt-hour returns between aluminum and nickel.

[SMM Analysis] Reassessing the Logic Behind Sulfur's "Surge" Driving Nickel Prices Higher

SMM Nickel News, May 6: Review of the Labour Day Holiday Market: During the Labour Day holiday (May 1–May 5), LME nickel overall consolidated at highs and moved sideways with relatively small fluctuations. On May 1, LME nickel closed at $19,410/mt. During the European session on May 5, LME nickel opened at $19,350/mt, reaching an intraday high of $19,515/mt and a low of $19,205/mt, holding up well. Overall during the holiday, LME nickel mainstream quotations were basically flat compared to pre-holiday levels. LME nickel inventory recorded a decrease of 1,002 mt for the week, while China's spot market saw no concentrated transactions due to the holiday closure. In the early session on the first trading day after the holiday, LME nickel once surged to a high of $20,000/mt, breaking through the previous high with a gain of approximately 1.6%. In China, the most-traded SHFE nickel contract broke through 155,000 yuan/mt, with an intraday gain of approximately 3.8%. Macro and Market News: (1) To maintain ample liquidity in the banking system, on May 6, 2026, the People's Bank of China will conduct 300 billion yuan in outright reverse repo operations through fixed-quantity, interest rate tender, and multiple-price winning methods, with a term of 3 months (91 days) and a maturity date of August 5, 2026 (to be extended in case of holidays). (2) On the evening of May 5 US Eastern Time, US President Trump posted on social media, stating that the "Freedom Plan" to "facilitate" vessel passage through the Strait of Hormuz will be suspended in the short term. Spot Market: On May 6, SMM #1 refined nickel prices rose by 2,800 yuan/mt from the previous trading day. Regarding spot premiums, Jinchuan #1 refined nickel averaged 1,250 yuan/mt, down 100 yuan/mt from the previous trading day. Domestic mainstream brand electrodeposited nickel premiums ranged from -800 to 100 yuan/mt. Currently, the US-Iran standoff continues, and passage through the Strait of Hormuz has yet to return to normal. Neither side has made concessions on negotiation issues. Affected by disrupted sulfur supply, production costs of hydrometallurgy intermediate products have risen significantly, providing solid "cost floor support" for refined nickel. However, affected by sluggish downstream consumption, China's nickel inventory remains in a state of significant inventory buildup. In the short term, the most-traded SHFE nickel contract is expected to trade in the range of 145,000–155,000 yuan/mt.

On February 2, 2026, a wave of limit-down declines hit the nonferrous metals sector. The most-traded SHFE nickel 2603 contract fell 11% intraday to hit limit-down, while the LME nickel 3M contract dropped over 7%, falling below $17,000/mt. The sharp decline in nickel prices today was mainly driven by the combined impact of macro fund outflows and the reality of high industrial inventories. Donald Trump nominated "hawkish" Kevin Warsh as Fed Chairman, shifting market expectations toward a more hawkish US Fed monetary policy, which boosted the US dollar. Additionally, previous nickel price gains, driven by expectations of tighter RKAB quota approvals for Indonesian nickel ore, were fueled by speculative funds, leaving them vulnerable to a correction due to insufficient fundamental support. When negative signals emerged, previously profitable bulls liquidated positions en masse, with open interest in the SHFE nickel weighted contract falling by over 30,000 lots in a single day. Concentrated selling triggered panic selling, accelerating the price decline. Supply and demand side, according to SMM data, China's refined nickel production in January 2026 increased 20% MoM, increasing supply pressure; however, downstream end-use consumption showed no signs of recovery, spot market trading was sluggish, and most enterprises had already completed pre-holiday stockpiling. Inventory side, LME nickel inventory exceeded 280,000 mt, while domestic visible inventory also remained high. SMM's domestic refined nickel social inventory surpassed the 70,000 mt level last week, with a weekly inventory buildup of 4,349 mt. This sharp decline exhibited strong systematic and emotional characteristics, coupled with relatively weak fundamentals. In the short term, nickel prices may remain under pressure. However, expectations for reduced Indonesian nickel ore quotas persist, leaving room for a potential rebound in nickel prices later.

The nickel market started the week under slight downward pressure, then rebounded significantly amid positive macro news and developments in the Indonesian market. The most-traded SHFE nickel contract (2602) closed at 148,010 yuan/mt on Friday, up 2.52% WoW, with a weekly high of 150,000 yuan/mt; the LME nickel 3M contract settled at $18,850/mt, gaining 4.07% over the week.