FX.co ★ Nickel Futures Retreat From Recent Highs

Nickel futures have declined to approximately $17,800 per tonne, retreating from a recent peak of $18,700, the highest level in over nineteen months, reached the previous week. This drop is attributed to traders securing profits and a noticeable softening in demand from China. In China, spot nickel prices have fallen by around 3,450 yuan per metric tonne, indicative of profit-taking activities and tepid buying appetite. Concurrently, SHFE nickel futures have decreased by 1.6%. On the supply side, constraints continue to provide price support. Notably, Indonesia has announced a 34% reduction in its 2026 nickel ore production quotas compared to last year, aiming to balance production with processing capacities and preserve high-grade ore deposits. Additionally, Nickel Industries reported a downturn in revenue for the December quarter due to a delay in obtaining a sales license, resulting in a drop in ore sales from 3.09 million wet metric tonnes to 945,000. However, early January saw a resumption of shipments, with 735,000 wet metric tonnes sold by January 17, which underscores the market's anticipation of controlled supply levels from Indonesia.