SMM Base Metals Market Daily Review (2015-4-22)

SHANGHAI, Apr. 23 (SMM) – 

 

Copper 

The most active SHFE copper contract dipped to a low of RMB 43,080/mt after opening on Wednesday and increased to RMB 43,350/mt at midday. In the afternoon, the prices touched a high of RMB 43,430/mt helped by rallying stock market and ended down RMB 50/mt at RMB 43,310/mt. Trading volumes for the SHFE 1506 copper contract decreased 63,910 lots and positions dropped 10,270. Trading volumes of SHFE 1507 copper contract fell by 16,226 lots, while positions grew 10,558.

 

Spot copper was offered at premiums of RMB 170-250/mt to SHFE 1505 copper contract early on Wednesday. Prices are RMB 43,470-43,630/mt for standard-quality copper and RMB 43,500-43,670/mt for high-quality copper.

 

Some traders purchased spot goods to deliver term contracts, pushing up spot premiums. Supply of standard-quality and hydro copper remained limited. Some bullish speculators refrained from selling, leaving few chance for downstream producers to pressure prices. Trading improved noticeably. In the afternoon, traders were more willing to sell with SHFE copper rising, which plus inflow of imported copper, narrowed spot premiums slightly to RMB 200-220/mt. 

 

Aluminum      

On Wednesday, SHFE 1507 aluminum contract became the most active one. Rising Chinese A share helped push the contract up to RMB 13,165/mt. Finally, July aluminum on the SHFE ended at RMB 13,155/mt. Trading volumes totaled 25,344 lots, with positions up 6,244 to 117,800. 

 

Spot aluminum largely traded between RMB 12,970-12,990/mt in Shanghai on Wednesday, discounts of RMB 110-130/mt over SHFE 1505 aluminum contract, versus RMB 12,970-12,980/mt in Wuxi, and RMB 13,010-13,020/mt in Hangzhou. Downstream consumption remained sluggish, but traders increased purchases. In the afternoon, sellers raised offers to RMB 12,990-13,000/mt as SHFE aluminum continued to rise, but higher prices cooled buying.  

 

Lead

The most active SHFE 1506 lead edged up RMB 30/mt Tuesday night, following LME lead, and ended at RMB 13,560/mt. The most active contract lurched up to RMB 13,750/mt and ended at RMB 13,725/mt Wednesday, up RMB 195/mt, gaining 1.44%. Total trading volumes increased 1,288 lots to 10,376 lots and positions climbed 822 to 16,494.

 

In spot lead market, deals were mainly made for Humon and Tongguan brands Wednesday morning at RMB 13,650/mt. The prices of Shuangyan, Nanfang Humon, and Tongguan followed SHFE lead up later to RMB 13,680-13,700/mt, with premiums of RMB 20-50/mt to SHFE 1506 lead contract. Traders bought aggressively while downstream buyers purchased in small amounts. Price gap between secondary and #1 refined lead widened, prompting some to turned to secondary lead market. Traded prices in Henan remained high at RMB 13,650/mt, In Hunan, smelters refrained from selling, and prices in Jiangxi remained above SMM refined lead prices. 

 

 Zinc

SHFE 1506 zinc contract prices opened at RMB 16,440/mt, then touched RMB 16,500/mt, and closed the day at RMB 16,525/mt, up RMB 100/mt or 0.61%.

 

SHFE 1506 zinc contract prices opened at RMB 16,530/mt on Tuesday, then fell to RMB 16,480/mt in the morning, then leveled out, but reached RMB 16,590/mt in the afternoon, and closed at RMB 16,555/mt, up RMB 130/mt or 0.79%. Trading volumes decreased 24,040 to 68,304 lots, and total positions decreased 2,142 to 91,032. SHFE 1506 zinc contract prices are expected to strengthen this evening.

 

Prices of #0 zinc were RMB 16,400-16,450/mt, with discounts of RMB 80-110/mt to SHFE 1506 zinc contract. #1 zinc traded at RMB 16,340-16,350/mt, with some goods offered at RMB 16,360-16,370/mt. Zinc smelters moved goods normally after the price hike, but a few cargo holders cut shipments with goods tied up in futures market. Some intermediaries bought in spot markets to fulfill term contracts, but most downstream buyers only watched from the sidelines.

 

Shuangyan-brand #0 zinc sold for RMB 16,430-16,450/mt, with discounts of RMB 70-90/mt to SHFE 1506 zinc contract. Yuguang’s #0 zinc traded at RMB 16,420-16,440/mt, with discounts of RMB 80-90/mt. The same product from of Qilin and Qinxin brands traded at RMB 16,420-16,440/mt. Deals of Felong brand were made at RMB 16,400-16,430/mt, and SMC brand sold for RMB 16,390-16,420/mt. Indian #0 zinc traded at discounts of RMB 170-160/mt to the June delivery SHFE zinc, namely RMB 16,340-16,380/mt. Spot discounts did not expand in the afternoon.

 

Tin

In Shanghai spot tin market, mainstream traded prices rallied to RMB 110,500-112,000/mt on Wednesday, helped by rising LME tin. Downstream producers and traders entered the market to buy goods now that prices have stopped falling.  

 

 Nickel   

LME nickel moved between USD 12,700-12,780/mt after opening at USD 12,755/mt during Asian trading hours. SHFE 1507 nickel prices opened at RMB 96,320/mt and then slid to RMB 95,750/mt. Finally, the contract closed at RMB 96,330/mt, up RMB 420/mt. 

 

In China’s domestic spot market, SMM #1 nickel prices were between RMB 92,900-95,300/mt. Jinchuan nickel prices were RMB 1,200-1,500/mt above prices on the Wuxi electronic trading. Trading was light, with traded prices ranging RMB 93,100-94,900/mt. In the afternoon session, traders turned unwilling to sell Jinchuan goods, but supply of Russian nickel was healthy. Downstream producers, on the other hand, bought on need, with traded prices between RMB 93,300-95,000/mt.