(MB) Base metals traded on the Shanghai Futures Exchange were all down during morning trading on Tuesday February 26, with nickel leading the complex lower. The weakness in the base metals follows strong gains on Monday after the market reacted positively to the news that US President Donald Trump had postponed a planned increase in tariffs on Chinese goods due to progress made in US-China trade talks. But the base metals have struggled to hold onto these gains this morning after investors focused more on fundamentals and the renewed optimism over trade developments waned. Nickel was the worst performer of its peers with the metal’s most-traded May contract price sliding to 101,240 yuan ($15,079) per tonne as at 9.53am Shanghai time, down by 1.5% or 1,570 yuan per tonne from Monday’s close. The poorer showing in nickel relative to the rest of the base metals comes amid concerns of easing supply tightness in the market.

“The recently granted laterite ore export quota in Indonesia will alleviate supply tightness. The buoyance in investors’ confidence rallied the base metals higher yesterday, but that optimism have waned overnight and the fundamentals kicked in,” Chinese brokerage Guotai Junan Futures said in a morning note.

Prices of nickel pig iron (NPI) in China have been supported by a slight tightening of supply of the material in the country, but this tightness will be alleviated with new NPI projects due to come on stream, a Shanghai-based analyst told Fastmarkets.

Fastmarkets assessed the spot price for Chinese high-grade NPI at 1,000-1,020 yuan per nickel unit on February 19, up 50 yuan per tonne from 950-970 yuan per tonne the previous week.

Elsewhere, tin price retreated from its surge yesterday and registered a 790 yuan per tonne decline from closing price yesterday.

Elsewhere, tin prices similarly retreated following strong gains on Monday; the most-traded May tin contract fell 790 yuan per tonne to 151,860 yuan per tonne as at 9.53am Shanghai time.

The contract hit a high of 153,490 yuan per tonne on Monday amid expectations of tighter supply of tin concentrate in China after local miner Yinman Mining was suspended by the local Emergency Management Agency due to an accident at the company’s mine over the weekend.

“The mine disaster in Inner Mongolia along with positive news from the trade negotiation between US and China pulled the tin price up yesterday, but the spot demand is quite weak and the metal is vulnerable to further price drops,” the Shanghai-based analyst added.