Expert nickel market insights
Our quarterly nickel outlook is published in our Quarterly Metals Report, which covers base, precious and ferrous metals. The impact of supply and demand fundamentals and macroeconomic implications for the nickel futures and spot prices are analysed. Our research team produce a nickel price range forecast as part of the report.
Nickel Outlook – Q1 2024
The nickel market experienced a notable decline in Q4 2023 due to lacklustre demand and an oversupply of low-cost nickel from Indonesia. The supply surge is expected to continue until it peaks in 2026, leading to a substantial global surplus in 2024. The demand outlook for Q1 2024 remains unchanged, but the market is unlikely to overextend the fall to $15,000/t if the $16,000/t support level breaks. With many mines and smelters under pressure to maintain profit margins, a delicate balance of supply and demand is expected in the coming months.
During the last quarter, the markets expected the Fed to begin a cutting cycle, which caused the dollar and Treasury yields to decrease. This, along with predictions of China's recovery in 2024, boosted the prices of base metals by the end of the year. However, in Q1, the situation has changed. The US economy has shown robustness in terms of the labour market and consumer performance, which has led the market to price in the probability of cuts further down the curve. Additionally, despite continued support from the government, Chinese pessimism has yet to subside. In the upcoming months, macroeconomics will continue to play a crucial role in driving the day-to-day momentum, particularly in the aluminium and copper markets. Structural and cyclical indicators will also come into play when assessing the path for base metals performance. COT positioning, spreads, and stocks will drive the general price trend in the first half of the year while anticipating an economic recovery and easing monetary policy pressures in the latter half of the year.
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