SHANGHAI, Nov. 25 (SMM) –
Copper:
SHFE 1202 copper contract prices, the most active one, opened slightly up by 630/mt at RMB 54,210/mt on Thursday. After the opening, as selling pressures from short investors increased, newly built positions were up 40,000 lots. In this context, SHFE three-month copper contract prices fell to an intraday low of RMB 52,510/mt after losing RMB 54,000/mt and RMB 53,000/mt. However, as SHFE copper prices touched the lows, short-term short investors began to cash out of the metal in the morning business, helping prices return to earlier trading hour levels and climb to an intraday high of RMB 54,790/mt. SHFE three-month copper contract prices came under pressure at the 5-day moving average in the afternoon session, basically fluctuating around the RMB 54,000/mt level. Finally, SHFE 1202 copper contract prices closed at RMB 54,440/mt, down RMB 400/mt or 0.73%. Positions for SHFE 1202 copper contracts were up 812 lots, and trading volumes were up 507,000 lots. Short investors mainly made intraday transactions and opted to close positions at the tail of trading to ward off overnight risks. SHFE copper prices would extend fluctuations over the near term.

In the spot market, as SHFE copper prices fluctuated widely, spot copper premiums fell to positive RMB 450-700/mt from RMB 550-800/mt in the morning business. Traded prices for standard-quality copper were between RMB 54,700-55,700/mt in the morning business, and RMB 55,000-55,900/mt for high-quality copper. Imported copper increased during the whole trading day due to profits, and cargo-holders of low-quality imported copper were actively moving goods and voluntarily downgraded premiums, dragging down premiums for domestic copper. Downstream producers were not seen to make purchases at low price levels. In the afternoon session, although SHFE copper prices made corrections and spot copper supply contracted compared with the morning business, copper offers were basically flat with the morning session, while traded prices declined to between RMB 55,400-55,800/mt. The price gap between low-quality imported copper and domestic high-quality copper was significant this week, which highlighted different market sentiment and would help future copper prices continue to fluctuate widely.          

Aluminum:
The most active SHFE aluminum contract 1202 opened lower at RMB 15,840/mt and closed RMB 45/mt or 0.28% lower at RMB 15,880/mt on November 24th. The contract hit the intraday low of RMB 15,700/mt in the morning. Positions of the contract increased 1,556 lots to 85,394 lots. SMM expects the most active SHFE aluminum contract to fluctuate near RMB 15,800/mt in the short term.

Traded prices of spot aluminum in Shanghai were between RMB 15,790-15,830/mt on Thursday, with premiums of RMB 0-20/mt over the SHFE current-month aluminum price. Low-iron aluminum was traded between RMB 15,850-15,890/mt in Shanghai. Traded prices of spot aluminum in Wuxi were between RMB 15,770-15,830/mt. In the morning, SHFE aluminum prices rebounded after opening lower and violent fluctuations. Hence, goods holders were increasingly reluctant to move goods. The buying interest was low among downstream buyers and middlemen after prices climbed, though, with transactions only slightly active at around RMB 15,800/mt. Spot aluminum prices climbed with rallying futures prices. Most players stood on the sidelines, however, as the wait-and-see sentiment dominated with higher rebound expectations. In the afternoon, as SHFE aluminum prices stabilized, spot quotations were held firm between RMB 15,810—15,820/mt by traders. The downstream buying interest was low, however, leading to limited transactions.

Lead:
SHFE 1201 lead contract prices opened at RMB 15,240/mt on Thursday and fell soon, with positions increasing. Prices then fell below RMB 15,000/mt and stopped dropping at RMB 14,935/mt. In the midday, SHFE lead prices rallied with domestic stocks and rose above RMB 15,000/mt and finally closed at RMB 15,190/mt, down RMB 50/mt. Trading volumes increased by 144 lots to 624 lots, and positions increased by 100 lots to 2,254 lots.

Well-known brands in domestic spot markets were firm. SHFE lead prices were low in the morning. Traded prices for Yuguang, Chinhong Zn & Ge and Nanfang were around RMB 15,100/mt, and premiums against SHFE 1201 lead contract prices expanded to RMB 70-100/mt, but narrowed to RMB 50/mt along with the rising SHFE lead prices. Well-known brands of lead were traded at RMB 15,250/mt. In the afternoon, lead prices remained between RMB 15,200-15,250/mt. Transactions improved slightly, with both traders and downstream buyers more willing to purchase at lower prices.

Zinc:
On Thursday, SHFE three-month zinc contract prices plummeted to as low as RMB 14,665/mt after opening, dragged down by LME zinc prices overnight, but found support and moved between RMB 14,750-14,800/mt later the day. Boosted by the Shanghai Composite Index, SHFE three-month zinc contract prices edged up to move between RMB 15,000-15,100/mt in the afternoon, with prices finally closing at RMB 15,025/mt, down RMB 140/mt, or 0.92%. Trading volumes increased by 250,000 lots to 487,034 lots, and total position increased by 6,432 lots to 193,284 lots.

In domestic spot markets, spot prices were firm, with premiums between RMB 50-70/mt against SHFE 1202 zinc contract prices in the morning session. #0 zinc was traded between RMB 14,800-14,850/mt. As SHFE zinc prices rose at noon, spot premiums narrowed to RMB 20/mt, and #0 zinc prices climbed to RMB 14,900-14,950/mt. #1 zinc was traded between RMB 14,850-14,900/mt. Downstream buyers were actively replenishing stocks, but cargo holders held prices firm due to tight goods supply, with transactions improving. 

Tin:
Shanghai spot tin prices finally ended several days of drop on November 24th as smelters continued to hold goods. Mainstream Yunxi, Yunheng, Jinhai, Yunshan, Nanshan and Jinlong branded tin was traded between RMB 172,500-174,500/mt. The traded volume remained limited, however. Smelters in Yunnan, Guangxi and Hunan etc. have beening holding their quotations above RMB 176,000/mt expecting to help domestic tin prices stabilize, which seemed to have worked. Supply at lower prices still exists, however, and the downstream demand remains weak, adding to doubts whether domestic tin prices can consolidate at current levels.

Nickel:
LME nickel prices fluctuated narrowly after opening at USD 17,180/mt during the Asian and early European trading hours on Thursday, meeting resistance at USD 17,325/mt and finding support at USD 17,145/mt. Tepid economic data from three major economies fueled short sentiment in the market and boosted the US dollar higher, which in turn weighed on base metal prices. Premium of LME spot nickel was USD 11/mt. LME nickel inventories continued to surge, with inventories up 2,190 mt to 88,476 mt.

In the Shanghai nickel spot market, spot nickel prices continued to tumble along with steady decline of LME nickel prices. Mainstream traded prices of nickel from Russia were around RMB 125,500/mt. Although many cargo holders quoted offers at RMB 126,000/mt, actual transactions at this price level were limited. Mainstream traded prices of nickel from Jinchuan Group were in the RMB 127,500-128,000/mt range. Trading sentiment did not improve significantly, as downstream demand was soft and since traders had low interest in making deals. Most market players were pessimistic towards market outlook, and had low trading interest.