Core Viewpoint - Nickel prices continue to rise due to supply constraints driven by policy changes and improved macro liquidity expectations, with significant impacts from Indonesia's reduction of nickel ore quotas [1][2]. Supply Side: Clear Contraction - Domestic smelting plants have reduced operating rates due to the Spring Festival holiday, leading to a temporary decrease in nickel iron supply. Indonesia's quota cuts and increased mine maintenance have tightened raw material supplies, pushing up nickel ore prices and supporting nickel iron costs [2]. Demand Side: Inventory Phase-Out - Downstream demand shows structural differentiation. The stainless steel industry is reducing production due to high raw material prices, while new energy battery companies have completed pre-holiday inventory and are now focused on essential purchases. Overall demand has slowed but remains stable enough to support prices [3]. Supply-Demand Dynamics: Low Inventory Dominance - In the current environment of weak supply and demand, inventory levels are crucial in influencing price trends. Domestic and international inventories are at historically low levels, heightening concerns about supply tightness, which helps maintain nickel prices despite weakening demand [4]. High Price Market: February 12th Nickel Spot Trading Insights - The spot market shows a "price rise, volume decline" characteristic as nickel prices strengthen. Traders are leaving the market for the holiday, leading to lower trading activity. Spot prices are rising with futures, but the spread structure remains stable, indicating limited acceptance of high prices by downstream buyers [5]. Short-Term Outlook: Will the Uptrend Continue? - After February 12th, nickel price increases are expected to slow down and enter a high-level fluctuation phase. With weakening spot trading and the end of pre-holiday inventory, upward momentum may diminish. However, low inventory and cost support remain, with expectations for the main nickel contract to trade between 138,000 and 141,000 yuan/ton. Post-holiday, market focus will shift to the pace of demand recovery, with potential for continued strength if downstream operations resume smoothly [6].