SHFE approves Norilsk Nickel brands for delivery against futures

The Shanghai Futures Exchange has approved the application of the Russian Norilsk Nickel to supply its nickel brands to the exchange, the SHFE announced on its website. Russian Norilsk Nickel has been authorized to supply three brands of nickel since June 29, 2015, including the Norilsk N-1 Combine, the Severonikel N-1 Combine, and the Severonikel N-1Y Combine. Norilsk Nickel is the first international brand to be allowed by SHFE to supply against its futures contracts, as it believes that domestic suppliers will be unable to provide sufficient supply.

Thanks to the successful registration on the SHFE, Norilsk Nickel has a good chance to increase sales of its products in the Chinese market, ensuring the possibility of supplying its nickel grades to the Shanghai Futures Exchange. Registration also provides a completely transparent pricing mechanism, including in yuan, which makes it profitable to supply nickel to small and medium-sized enterprises in China that are not allowed to trade on the London Metal Exchange (LME).

Norilsk Nickel's head of international sales, Markus Meurer, emphasized that Norilsk Nickel is the only foreign company among global nickel producers whose product brands, along with Chinese producers, are registered on SHFE. He noted the importance of this event for the company, since the Chinese market is considered one of the most promising in the world. In this connection, Norilsk Nickel expanded its opportunities not only in the market of this country, but also strengthened its leadership positions at the world level.

Expectations that a wave of nickel shipments will rush to China after the registration of the Russian Norilsk Nickel mark on the Shanghai Futures Exchange led to a drop in the price of nickel in Asian trading. Market participants say that the current situation is capable of keeping prices in check for the rest of the year. At the same time, the Shanghai Futures Exchange is actively seeking to continue the registration of the foreign nickel offer.