SHANGHAI, Nov. 17 (SMM) –As LME copper prices narrowed gains overnight, SHFE 1201 copper contract prices opened 340/mt lower at RMB 57,810/mt on Wednesday. After the opening, SHFE three-month copper contract prices temporarily climbed to RMB 58,210/mt as long investors entered the market, but then slid all the way and lost RMB 57,000/mt before the midday after the Shanghai Composite Index slumped by nearly 3% to below 2,500 points, and since LME copper prices fell by USD 200/mt given resistance to move towards highs. Nevertheless, SHFE three-month copper contract prices got support at the daily moving average after declining to RMB 56,330/mt in the afternoon session, easing declines and fluctuating around RMB 56,500/mt. Finally, SHFE 1201 copper contract prices closed at RMB 56,610/mt, down RMB 860/mt or a loss of 1.5%. Positions for SHFE 1201 copper contracts were down 26,210 lots but trading volumes were up 34,466 lots, while positions and trading volumes for 1202 copper contracts were up 33,646 lots and 165,000 lots, respectively, highlighting the continuous shift of the most actively-traded copper contracts. Due to unclear directions, SHFE copper prices would lower to test the 30-day moving average. 

In the spot market, cargo-holders became more willing to move goods at high prices and pushed up quotations for copper premiums to between RMB 150-350/mt in the morning business. As SHFE copper prices fell all the way after a high open, spot copper premiums expanded to between positive RMB 300-450/mt near the midday. Traded prices for standard-quality copper were between RMB 57,700-58,000/mt in the morning business, and RMB 57,800-58,400/mt for high-quality copper. However, most downstream producers still stuck to the sidelines, while speculative activity was also restricted. The gap between the highest and lowest traded prices reached RMB 1,000/mt in the morning business, and cargo-holders were very willing to make sales. In the afternoon session, as SHFE copper prices continued to slide, spot copper premiums rose to between positive RMB 400-500, while traded prices fell to between RMB 57,250-57,600/mt, with low trading sentiment on the market. Because of ample market supply, buyers were reluctant to make purchases at above the RMB 58,000/mt level in the afternoon business.