The three-month nickel price dropped below $14,000 per tonne for the first time since April 13, with volumes traded at their lowest since April 6.
“Trade tensions dragged nickel into the spotlight, but fundamentals have come back in to play,” Geordie Wilkes, head of research at Sucden Financial, said at Sucden’s Quarterly Metals Report Briefing.
“On the whole, there are a lot of moving parts in the nickel market. Sanctions would certainly raise volatility, but we see the price remaining well-supported in the short term,” he added.
Similarly, aluminium’s three-month price has dropped 10.5% over two days, making significant drops to pre-sanction figures around $2,000 per tonne.
Aluminium’s price began to drop after the US announced on April 23 that no further sanctions would be imposed against Rusal, nor any of its subsidiaries.
Volumes and cancellations remain high for aluminium however, with supply uncertainties still clouding market sentiment.
Comparatively, copper’s three-month price found support during the afternoon, closing above $7,000 per tonne and climbing 2% over the day.
“Ongoing labor negotiations at BHP’s Escondida mine (the world’s largest mine production site, producing 18% of Chilean copper) represent a key risk to supply,” Boris Mikanikrezai, analyst at Metal Bulletin said.
“Encouragingly, workers have agreed to early talks with management, which is a positive signal and thus lowers the likelihood of strike action,” he added.
Zinc continues to remain in consolidation, with Sucden Financial’s Liz Grant suggesting that the metal could be well-supported in the near term.
“Technical tightness on the exchange has little relation to physical supply. The zinc market is looking for something new and the galvanizing sector could be looking to benefit from stable production in the US and Europe,” Grant added.
Elsewhere, tin’s three-month price found marginal stability after dropping below the $21,500 per tonne mark. The metal’s cash/three-month spread has moved from a backwardation of $290 to $265b per tonne.
Aluminium, nickel continue drop
Currency moves and data releases