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Stainless Espresso: Nickel and stainless steel prices rise significantly
Stainless Espresso: Nickel and stainless steel prices rise significantly

January 11, 2022 – Nickel prices have risen significantly again on the SHFE today. Nickel on the LME is also up, jumping above $21,000 per tonne. Stainless steel futures jump due to production cuts and maintenance work in China. Aluminium on the rise due to European energy prices. And long-term contract prices for steel are at the high end of spot prices in the EU.

Base Metals: Nickel rises significantly

After nickel futures on the SHFE had already risen by more than 3.4% today, Tuesday, nickel on the LME also started trading strongly and is currently at around $ 21,445 per tonne.

Aluminium and stainless futures up

Aluminium and stainless steel futures on the SHFE are also up significantly. Stainless steel is up more than 4.3%, while aluminium is up almost 2% due to supply shortages. DCE iron ore is up about 2.77% and hot-rolled coil (HRC) is up 1.59%.

Chinese stainless steel futures jump

Back in early December 2021, we pointed out that Chinese stainless steel producers would significantly cut production in January 2022 due to maintenance. In addition to production cuts until at least March 2022 in the steel industry due to government-ordered air quality improvements for the 2022 Winter Olympics in China.

Production cuts and robust prices

Chinese stainless steel futures jumped again today by 4.3% on production cuts and robust nickel prices. This is a continuation of Monday’s rise in stainless steel values.

Where is the price rise in nickel coming from?

Short: Nickel demand is high, availability is low. Demand from the automotive industry for battery nickel in particular has significantly emptied the LME’s stocks. This is boosting prices.

High demand for NPI

Demand for nickel pig iron (NPI) from Chinese steel mills has also increased noticeably, which has supported prices. Steel mills stocked up to ensure production around the CNY holidays despite maintenance work at the mills. NPI producers are currently passing on the increased raw material costs to buyers.

Aluminium: Production cuts drive up European prices

Due to higher energy costs, some European aluminium producers have reduced production, which has pushed up aluminium prices. Inventories on the LME have also fallen by more than 30% since mid-September 2021, suggesting robustly high demand.

EU steel: Long-term contract prices at the upper end of spot prices

In the European Union, the long-term contracts for steel in 2022 are currently being concluded between EU steel mills and large customers. It is already becoming apparent that the contract prices for steel are at the upper end of the current spot prices.

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