SHANGHAI, Jan. 6 (SMM) -- SHFE copper market opened flat on Tuesday. After failing to reach RMB 60,500/mt at opening, SHFE copper prices advanced quickly later. Of those, SHFE 1004 copper contract generally moved around RMB 60,300/mt in the morning session, and rallied along with rising A-shares stocks in the afternoon, with prices reaching as high as RMB 60,670/mt before closing, and prices finally ended at RMB 60,590/mt. Although positions for SHFE 1004 copper contract dropped slightly, trading value was still above RMB 81.5 billion, a sign of brisk trading. SHFE current-month copper contract prices largely fluctuated in the RMB 60,000-60,100/mt, and moved higher in the afternoon business, with prices finishing at RMB 60,300/mt.
In the spot market, discounts were flat with levels reported yesterday, since SHFE copper prices managed to stay at RMB 60,000/mt, with levels in the negative RMB 150-250/mt. in the morning, prices of high-quality copper failed to rise above RMB 60,000/mt, generally moving in the RMB 59,900-60,000/mt range. Prices of standard-quality copper were in the RMB 59,800-59,900/mt range. Market supply was dominated by domestic goods, with firm offers. Supply of imported copper was limited, as the customs clearance for goods ordered in late December 2009 are still under way. Cargo-holders were generally not eager to sell products, given optimistic outlook, narrower spot discounts, no cash pressure at the earlier year. Downstream producers remained cautious with purchases at prices above RMB 60,000/mt. As a result, overall trading sentiment was quiet.
If spot copper prices are able to stabilize at RMB 60,000/mt, SMM believes copper prices will advance further from potential strong demand at the beginning of the new year.
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