Nickel on MCX settled down -0.65% at 654.10 as sign of comfort in the Chinese nickel market is that inventories monitored by the Shanghai Futures Exchange are still at relatively high levels. Prices are under pressure on the sign that there is no shortage of Nickel in China, China is still getting all of the nickel it needs, simply by increasing the amount it buys in more refined forms.
Chinese customs classifies nickel imports into refined nickel and alloy, ores and concentrates, and ferronickel. Imports of ferronickel surged 60 percent in 2016 from the prior year, with Indonesia storming back with a 250 percent increase to 747,097 tonnes, a 71 percent share. It's worth noting that Indonesian ferronickel isn't actually the same as supplies from other countries, being less refined and having a lower concentrate of nickel, as can be seen by Chinese customs data that showed in December it was less than half the price of cargoes from New Caledonia, the second-biggest supplier.
Meanwhile the global market for refined nickel started the year with a 1,100-tonne deficit for the month of January, a report from the International Nickel Study Group showed. While refined nickel consumption of 170,100 tonnes outstripped production of 169,000 tonnes over the month. The group also slightly trimmed last year's deficit to 49,500 tonnes.
Technically market is under fresh selling as market has witnessed gain in open interest by 8.05% to settled at 27870 while prices down -4.3 rupees, now Nickel is getting support at 650.5 and below same could see a test of 646.8 level, And resistance is now likely to be seen at 659, a move above could see prices testing 663.8.