Shanghai nickel prices hit record high on strong demand

Prices of nickel on the Shanghai Futures Exchange leaped to their highest on record recently, supported by solid demand and low inventories across the world.

The most-traded October nickel contract on the Shanghai Futures Exchange SNIcv1 hit a record 149,870 yuan (USD 23,197.89) a tonne, up 21% year-to-date.

Three-month nickel on the London Metal Exchange CMNI3 touched its highest since July 30 at USD 19,810 a tonne, having risen 17% so far this year.

Stainless steel and EV batteries are the top nickel-consuming sectors.

Refined nickel inventories in ShFE warehouses NI-STX-SGH hit a record low of 4,455 tonnes, down 89% from a year earlier. Stockpiles in LME warehouses MNISTX-TOTAL fell to their lowest since January 2020 to 194,466 tonnes.

A wave of automotive cutbacks due to semiconductor chip shortages is likely to reduce nickel demand in Q4 and extend into 2022.

LME nickel prices to fall to USD 18,000 a tonne on average in the Q4, from USD 19