SMM Base Metals Market Daily Review (2015-8-5)

SHANGHAI, Aug. 6 (SMM) – 

Copper 

SHFE 1510 copper contract started at RMB 38,330/mt for Tuesday’s night session, and finished RMB 310/mt higher at RMB 38,280/mt, with high-end price at RMB 38,430/mt and low-end at RMB 38,160/mt.

SHFE copper slipped to RMB 38,000/mt in response to falling LME copper early Wednesday and touched a low of RMB 37,860/mt. In the afternoon, the most active contract rallied and finally closed at RMB 38,120/mt, up RMB 150/mt or 0.4%. Trading volumes slipped 136,000 while positions were up 9,066.

In Shanghai market, spot copper discounts were to RMB 10-80/mt to SHFE 1508 copper Wednesday morning and narrowed slightly in the afternoon to RMB 0-60/mt. Standard-quality copper quoted RMB 38,400-38,480/mt and RMB 38,440-38,520/mt for high-quality copper.

Cargo holders were active to sell. Guixi copper was favored by buyers, with its price on par with SHFE 1508 copper. Price gap between hydro-copper and standard-quality copper widened as sellers offered lower prices for the former. Traders’ buying activities grew whereas downstream producers still watched from the sidelines.

Aluminum      

SHFE 1510 aluminum hovered around RMB 12,090/mt after opening at RMB 12,140/mt on Wednesday. The light metal followed LME aluminum up to RMB 12,140/mt in the afternoon, but then fell back before ending lower at RMB 12,120/mt. Trading volumes were down 13,514 lots to 18,196 lots, and positions were up 1,026 lots to 146,000 lots. 

Aluminum prices were mainly between RMB 11,960-11,970/mt in Shanghai on Wednesday, discounts of RMB 40-30/mt over August aluminum on the SHFE, versus RMB 11,930-11,960/mt in Wuxi and RMB 11,960-11,970/mt in Hangzhou. Downstream consumption was sluggish. Prices in Shanghai and Hangzhou held stable, those in Wuxi slipped RMB 10/mt. Ample supply prevented prices from rising. In the afternoon, some raised offers to RMB 11,980-12,000/mt after SHFE aluminum rose. Lead

For night trading Tuesday, SHFE 1510 lead ended RMB 185 higher at RMB 12,945/mt.

SHFE lead remained range-bound between RMB 12,900-12,940/mt during Wednesday trading session and finally closed at RMB 12,920/mt, jumping RMB 160/mt. Trading volumes were 4,262 lots. Positions grew 456 to 17,806.

Traded prices were RMB 13,220-13,230/mt for Nanfang brand in Shanghai, RMB 310/mt higher than SHFE 1510 lead. Hanjiang and Humon brands quoted RMB 13,200-13,220/mt and RMB 13,170/mt for Jinyuteng brand.

Lead smelters were active to sell after Wednesday’s lead price hikes. Nanfang, Hanjiang and Humon brand goods all flowed into market. However, wait-and-see posture overshadowed downstream market. Only a small number of buyers purchased as usual. As a whole, trades were weaker than Tuesday.

Zinc

SHFE 1510 zinc contract prices opened at RMB 14,810/mt Tuesday evening, then reached RMB 14,870/mt, but fell back and closed at RMB 14,745/mt. Trading volumes on SHFE zinc were over 60,000, and total positions increased 1,318 to 316,516. SHFE 1510 zinc contract prices dipped to RMB 14,645/mt after opening on Wednesday, then surged to RMB 14,800/mt with rebounding China’s A-share market in the afternoon. But since China’s A-share market plunged again at the end of trading, SHFE 1510 zinc contract prices closed at RMB 14,735/mt, up RMB 105/mt or 0.72%. Trading volumes decreased 29,006 to 104,676 lots, and total positions increased 3,066 to 155,098. SHFE 1509 zinc contract prices are expected to consolidate.

#0 zinc prices were between RMB 14,950-14,980/mt, RMB 280-300/mt above SHFE 1510 zinc contract prices on Monday. #1 zinc prices were RMB 14,890/mt. Spot premiums were RMB 280-300/mt against SHFE 1510 zinc contract prices when the latter fluctuated below RMB 14,700/mt after opening, with trading quiet. As SHFE 1510 zinc contract prices rose above RMB 14,700/mt, spot premiums of #0 zinc fell to RMB 270-290/mt against SHFE 1510 zinc contract prices. Smelters held back goods on rising zinc prices, leaving deliverable zinc limited. However, traders sold actively. Downstream buying interest was weak. Spot premiums of registered #0 zinc against SHFE 1510 zinc contract prices were RMB 260-280/mt in the afternoon. Shuangyan zinc prices were between RMB 14,990-15,020/mt, with spot premiums against SHFE 1510 zinc contract prices of RMB 280-300/mt. Traders purchased at lows, but trading was muted.

Tin

In Shanghai spot tin market, consumption was sluggish in the off-season. Mainstream traded prices were stable at RMB 108,800-110,500/mt on August 5. Goods from Yunnan Tin Group traded at RMB 109,500-110,500/mt.

Nickel   

SMM #1 nickel prices were between RMB 80,200-81,200/mt. Premiums of Jinchuan nickel against the most actively traded contracts on the Wuxi electronic trading were RMB 500/mt in the morning. Jinchuan Group left ex-works prices unchanged in the morning, which is below market price. Purchases under term contracts grew, with traded prices between RMB 80,300-81,000/mt. Nickel prices surged initially but fell back in the afternoon, with most trading between arbitrage traders, with traded prices between RMB 80,300-81,100/mt.