SMM #1 nickel prices were between RMB 108,700-109,200/mt. Spot nickel prices rose in the morning, but downstream demand was weak, with overall transactions muted, and traded prices between RMB 108,700-109,100/mt. Spot nickel prices inched lower in the afternoon. Traders sold actively. When combined with a large influx of imported nickel, spot premiums decreased sharply. Downstream buyers watched on the sidelines, with traded prices between RMB 108,100-109,300/mt. Jinchuan raised nickel prices by RMB 1,000/mt to RMB 109,000/mt.

SMM surveyed 30 market players to find that 7 are bullish toward nickel price trends this week, 12 are neutral and 10 are bearish.

The 24% optimistic market players believe LME nickel prices will jump to USD 15,200/mt. Tight NPI supply will bolster nickel prices. In the meanwhile, the US dollar index will lack impetus to rise further in the near term.

42% see LME nickel prices moving between USD 15,000-15,200/mt. The likelihood of Greek exit of the euro zone, sluggish economy in China and weak demand compounded pressure on LME nickel prices. But supports will be also strong.

34% are bearish, believing LME nickel prices will fall below USD 14,800/mt. A large inflow of Russian nickel, combined with supply from Jinchuan, led to ample supply. This caused spot premiums against 1503 nickel contracts on the Wuxi electronic trading to narrow. Demand also softened as the Chinese New Year holiday nears. In addition, LME nickel inventories are expected to breach 430,000 mt, weighing on nickel prices. LME nickel prices should fall to test the 10-day moving average.