After brief Covid19 concerns, base metals had executed a slight downward correction on a broad front yesterday, Monday, July 19, 2021. Today, the prices of nickel, aluminum, copper and others are already rising again. In the United States, nickel premiums are in short supply on the spot market. And in China, heat and general shortages are causing power cuts and outages again.

Stainless Espresso: Base metals already back in uptrend
Stainless Espresso: Base metals already back in uptrend

Base metals already on the rise again

Yesterday, the base metals on SHFE and LME have weakened. Triggered by possible new Covid19 restrictions. However, the most traded nickel contract 2108 on the SHFE has already overcome its low of today’s trading day, July 20, 2021, and is currently only at a minus of about $ 350 per ton.

Nickel futures on the LME are currently up about $190 per ton from the opening of the trading day.

Rising Asian nickel prices expected

Asian industry insiders expect nickel prices will gradually rise after the correction this week. LME nickel is expected to trade between $18,600-19,200/mt on week. SHFE nickel is expected to trade between 138,000-144,000 yuan/mt on week.

Vale Indonesia produces almost 20% less nickel matte

PT Vale Indonesia’s INCO.JK is reported to have produced significantly less nickel matte than last year. A decrease of almost 20% is assumed.

US market affected by nickel shortage

In the United States, one of the world’s largest nickel producers, Nornickel, is sorely missed. Since February 2021, the Russian producer of high-quality nickel products no longer offers on the US market. Due to strikes at the Canadian nickel producer Vale since June 1, supply is becoming increasingly difficult and nickel premium prices are therefore rising significantly.

Stainless steel spot prices without significant movement

Chinese spot prices are unimpressed by the price fluctuations in nickel. The reference price for 304 2B today is not even $20 below yesterday’s high.


China: Summer heat leads to power outages and energy cuts

In general, the electricity problem in China has not yet been overcome again. Southern China is currently affected by temperatures around 40 degrees and more. As a result, EAF steelmakers are unable to operate at full capacity. This is reported by Chinese media. Furthermore, there are cutbacks in energy supply in further provinces.


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