Nickel/Prices continue to climb

摘要

Nickel prices on the LME continued to rise over the past month. The rise has been driven by fund and other speculative interests, as prices are running slightly ahead of fundamentals. The funds have jumped into the LME metals as equities continue to move sideways with little prospect of the ending of the three-year bear market in the near future. Having broken through the 8,000 dollars/tonne level in January, the next target for the rally was 8,500 dollars/tonne. This was first achieved in late January, but a period of consolidation was needed before the 9,000 dollars/tonne level could be tested. Following the third Wednesday pricing on 19 February, when the official price of both cash and 3-month nickel came in at 8,490 dollars/tonne, the market quickly made a push for 9,000 dollars/tonne. The cash to 3 spread took the strain as the contango seen over the November-January period turned into a backwardation. Prices raced up to a high of 9,110 dollars/tonne for 3-month on 26 February, when official prices topped out at 9,050 dollars/tonne for 3-month with a 55 dollars/tonne cash-to-3 backwardation. However, the momentum has not proven to be sufficient to keep prices at these elevated levels and nickel has been trading in an 8,500-9,000 dollars/tonne range up to the time of writing.