BEIJING: Nickel prices in Shanghai hit a 16-month low on Monday, pulled down by waning demand from the stainless steel sector and higher supply in China, the world’s biggest consumer of the metal.
The most-traded December nickel contract on the Shanghai Futures Exchange was down 5% at 122,690 yuan ($17,014.05) per metric ton, as of 0159 GMT, its lowest since July 2022.
Three-month nickel on the London Metal Exchange slid 0.5% to $16,055 per ton, extending losses after hitting a 2-1/2-year low last Friday.
Loss-making conditions in the stainless steel sector - the main consumer of nickel - led to wider production cuts and weighed down prices of its raw material, analysts at Yinhe Futures said.
“Nickel consumption from electric vehicles also came in softer than expected.”
The market also suffered from rising stocks, with a capacity ramp-up in both Indonesia and China.
Stocks of SHFE nickel rose 16.4% to 12,623 tons last Friday, about four times higher than the levels at the beginning of the year.
China’s refined nickel output totalled 197,200 tons in Jan-Oct period, up 38% from the year-ago period, data by Shanghai Metals Market showed.
London nickel nosedives to 2-1/2 year low on oversupply pressures
Other base metals prices were mixed on Monday after China’s industrial firms extended gains for a third month in October.
Investors’ focus will likely be on key US data due on Thursday, with inflation expected to slow to its lowest since mid-2021.
LME copper shed 0.3% to $8,405.50 a ton, aluminium gained 0.4% at $2,225.50, tin increased 0.9% to $24,100, zinc slipped 0.4% to $2,544, lead declined 0.5% to $2,186.
SHFE copper added 0.1% to 68,260 yuan a ton, aluminium climbed 0.7% to 18,935 yuan, zinc gained 0.5% to 21,150 yuan, lead slid 2% to 16,140 yuan, tin slipped 1.1% at 199,500 yuan.
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