Shanghai Futures Exchange copper climbed 0.4 percent to 54,670 yuan ($8,234) a tonne on Monday supported by upbeat sentiment over potential demand from electric vehicles in the wake of last week's cheery London industry week. Goldman Sachs upgraded its nickel forecasts, but said prices were more likely to find nearby support from China's pollution crackdown given EV demand is set as a story for 2020 on.
"We expect nickel prices to remain high over the next couple of months, on a supportive macroeconomic backdrop and market tightening driven by Chinese nickel pig iron (NPI) cuts in Shandong province during the winter heating season," it said a report. NPI is a low-grade composite of nickel. "Even though the EV wave poses significant upside risk to nickel demand, we think much of the growth is likely to take place after 2020 and the current stock level will be sufficient to cover the demand before then."
Goldman upgraded its 3-month nickel view to $12,500 a tonne from $9,000, its 6-month view to $12,000 a tonne from $9,000 and its 12-month view to $11,000 from $9,000 a tonne. Hedge funds and money managers reduced their net long position in COMEX copper contracts in the latest week.
The launch of new base metals trading platform NFEx could be pushed back from the first quarter of 2018 as potential users are still busy getting their systems ready for new European Union rules. Officials in China's Xiamen seized over 1,400 tonnes of imported zinc waste recently, after launching a campaign against foreign waste harmful to the environment in March.