SHANGHAI, Aug. 12 (SMM) – During Monday evening session, SHFE 1510 copper started at RMB 38,010/mt and then soared to RMB 39,200/mt before ending at RMB 39,020/mt, up by RMB 1,170/mt or 3.09%. SHFE copper outperformed LME copper, pushing SHFE/LME copper price ratio up to 7.36. Trading volumes were 340,000 lots and positions fell 8,612.
SHFE copper once advanced to RMB 39,820/mt as shorts exited market for day trading Tuesday and then narrowly moved around RMB 39,200/mt with SHFE/LME copper price ratio above 7.5. The red metal finally closed at RMB 39,060/mt, up RMB 1,210/mt, gaining 3.2%. Trading volumes of SHFE 1510 copper saw a rise of 348,000 lots while positions fell 39,922. Trading volumes of copper futures grew 591,000 lots with positions down 51,522.
On Tuesday, spot copper traded at a discount of RMB 50-150/mt in Shanghai market. Mainstream prices were RMB 39,320-39,640/mt for standard-quality copper and RMB 39,380-39,680/mt for high-quality copper.
Some speculators sourced cheaper copper in market early morning. Sellers rush to ship goods out after price rises in SHFE copper. This helped spot discounts to expand with spot discounts on high-quality copper above RMB 100/mt. Therefore, price gap between high-quality and standard-quality copper narrowed. Price as high as RMB 40,000/mt discouraged buyers. Traders hunted cheaper copper for term contracts. Thus, trades declined after a rally on Aug. 11.