Why Premiums of Jinchuan Nickel Surge in Late December? Will Price Gap between Jinchuan and Russian Nickel Continue Growing?
Nickel price slid all the way from mid-December, and spot premiums of Jinchuan nickel surged to 1,200 yuan per tonne in late December, the highest of 2016. The price gap between Jinchuan and Russian nickel expanded to more than 1,000 yuan per tonne. SMM compares ex-works prices of Jinchuan nickel in Shanghai and SMM average spot price of Jinchuan nickel and finds that the former was much higher than the latter after price hiking, briefly reaching 1,750 yuan per tonne on December 26. This reflected that Jinchuan Group held back sales in late year when nickel prices kept falling, and were unwilling to move goods at lows. So, spot supply of Jinchuan nickel was falling, bolstering up spot premiums of Jinchuan nickel. Moreover, supply of Russian nickel under warehouse receipts was ample, and the brief opening of profitable import window of nickel raised market expectation on higher supply of Russian nickel.
The 2017 Chinese New Year holiday is approaching, and Jinchuan Group will likely sell goods moderately before the holiday, and this will help relieve supply tightness of the product to some extent. Hence, SMM expects the gap between the two too narrow to 500-800 yuan per tonne.
- Analysis: Manufacturing helps China oil demand post fastest growth in 15 months
- China’s apparent oil demand surged more than 4% year on year in November.
- The 4.1% year-on-year growth in total apparent oil demand to 11.44 million bbl./day in November.
- OPEC Oil Output Slides in December Aimed Nigeria Disruptions
- OPEC’s crude production fell by 310,000 bbl./day in December.
- Nigeria’s daily output dropped by 200,000 bbl to 1.45 million in December.
- Saudi Arabia’s production fell by 50,000 bbl/day while Venezuela declined by 40,000.
- Iran, Kuwait and Angola each reduced output by 20,000 bbl./day, while Algeria and Iraq dropped by 10,000.
Investment & trading in securities market is always subjected to market risks, past performance is not a guarantee of future performance.
CapitalStars Investment Adviser: SEBI Registration Number: INA000001647
Our Some Best Services Read it Here…
www.capitalstars.com | T:+91-731-6790000,6669900