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SMM Daily Review – 2012/4/19 Copper Market
Apr 20,2012 08:52CST
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Source:SMM
SHFE 1207 copper contract for delivery in July opened RMB 150/mt lower at RMB 57,310/mt Thursday. Spot copper discounts were between negative RMB 100-50/mt in the morning business.

SHANGHAI, Apr. 20 (SMM) –The most-traded SHFE copper contract for delivery in July opened RMB 150/mt lower at RMB 57,310/mt Thursday. A falling US dollar during the day helped LME copper prices stand above USD 8,000/mt, which caused SHFE copper prices to stabilize around RMB 57,500/mt with an intraday low only at RMB 57,300/mt. At the tail of trading, as short investors were wary of building positions, SHFE copper prices surged to an intraday high of RMB 57,740/mt, which was lower than the prior day’s level, however, since the Shanghai Composite Index closed down. Finally, SHFE 1207 copper contract closed at RMB 57,670/mt, up RMB 210/mt or 0.37%. Trading volumes and positions for SHFE 1207 copper contract decreased by 266,000 lots and 6,080 lots, respectively, but positions for SHFE 1208 copper contract increased by 10,232 lots. SHFE copper prices won support at the 5-day moving average, but struggle between long and short investors existed. Coupled with limited bargain hunting when copper prices rebounded for two days in a row, sustainability of rebounds needed to be tested further.

SHFE copper prices extended rebounds. Spot copper supply increased as some warehouse warrants came into markets after SHFE 1204 copper contract was delivered. Spot copper discounts were thus quoted between negative RMB 100-50/mt in the morning business. Daily traded prices for standard-quality copper were between RMB 57,350-57,450/mt, and RMB 57,400-57,500/mt for high-quality copper. The price gap among all SHFE copper contracts expanded, but due to limited discounts, speculative activity was restricted, while downstream producers were also skeptical about copper price rebounds, leading market transactions to remain sluggish.

 

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