Non ferrous metals (nickel&stainless steel) weekly report: nickel shock continues, while stainless steel falls

Viewpoint: nickel shock continues and stainless steel falls in resistance

Macro: Canada announced a 50bp interest rate increase, leading the U.S; In October, the PMI of the Markit manufacturing industry in the United States was 49.9, falling below the 50 booms and bust line; The overseas economic situation weakened, increasing resistance to interest rate hikes, and the dollar index weakened. China's economic data in September remained weak and stable.

Supply and demand fundamentals: the domestic electrolytic nickel production declined slightly on a month-on-month basis and maintained positive year-on-year growth, with a cumulative year-on-year growth of 8.2% this year; The accumulated net import is 101000 tons; The total supply decreased by 58000 tons, about 20%. On the demand side, the demand for pure nickel has weakened year on year, and the acid dissolution of nickel beans lacks economy. The production of nickel sulfate has turned to high nickel matte and MHP. So far this year, the demand for nickel beans from nickel sulfate alone has shrunk by 40000 to 50000 tons; Alloy maintenance steel shall be purchased. New energy demand maintained explosive growth, and nickel sulfate was tight. Although the rising prices of ferrochrome and ferronickel have raised the production cost of stainless steel, the stainless steel profits are still fair, and the steel mills are willing to increase production. At present, the raw materials for stainless steel production are limited for a short time due to the epidemic situation in Inner Mongolia, and the price was supported at 16800 yuan/ton after falling last week.

Strategy: The fundamentals of pure nickel are weaker than last year, but the risk of short selling is higher under low inventory, so it is recommended to wait and see; Stainless steel is recommended to sell short at high prices, but not short.