Metals News
SMM Daily Review – 2012/3/20 Copper Market
smm insight

SHANGHAI, Mar. 21 (SMM) –SHFE 1206 copper contract prices, the most active one, opened RMB 310/mt higher at RMB 60,660/mt Tuesday. After the opening, SHFE copper prices slid immediately after fluctuating briefly, and only touched a high at RMB 60,790/mt. As a large number of short investors entered the market, positions increased to nearly 13,000 lots. SHFE copper prices thus drifted lower continuously, retreating to around RMB 60,200/mt in the afternoon session, but eased the falling momentum after touching the previous day’s low of RMB 60,120/mt. At the tail of trading, SHFE copper prices followed LME copper prices to rally above the daily moving average. However, due to position closings and as the Shanghai Composite Index fell by 1.4%, SHFE 1206 copper contract prices ended flat at RMB 60,350/mt. Positions for SHFE 1206 copper contracts were up 7,404 lots, and trading volumes were up 79,260 lots. SHFE copper prices would fluctuate near current values over the near term, due to unclear guidance from technical indicators but support at the low-end.

SHFE copper prices trended down after a high open, and SHFE 1204 copper contract prices also fell after initially increasing. Spot copper supply remained sufficient, so copper discounts failed to narrow, remaining between negative RMB 330-230/mt in the morning business. Traded prices for standard-quality copper were between RMB 59,450-59,600/mt, and RMB 59,550-59,850/mt for high-quality copper. Downstream producers increased buying at lower price levels, but wait-and-see sentiment still overshadowed markets. Market transactions remained limited as a result in the morning session. In the afternoon business, SHFE copper prices eased the falling momentum and rallied from the lows, so spot copper discounts expanded to between negative RMB 350-250/mt. Traded prices held flat with the morning business levels, but market transactions were fewer than the morning session levels, with both traders and downstream producers having no buying interest. 

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