SHANGHAI, Jun. 29 (SMM) --

Copper

As LME copper stabilized overnight, SHFE 1210 copper contract, the most active one, started RMB 670/mt higher at RMB 54,300/mt Thursday. After the opening, both longs and shorts chose to close positions on a large scale, and the Shanghai Composite Index retreated below 2,200, causing the contract to fall after climbing to RMB 54,400/mt. SHFE 1210 copper contract came under pressure at the daily moving average during the whole session, and tested a low at RMB 54,060/mt. Finally, the most active copper contract for October delivery ended RMB 570/mt or 1.06% up at RMB 54,200/mt, with trading volumes and positions decreasing by 136,000 lots and 27,128 lots, respectively. The turnover rate exceeded 130% amid position closings. SHFE copper prices are not expected to see any major changes in movements Friday, the last trading of this month, awaiting new directions for the second half of this year.

SHFE copper prices rebounded by 1%, so spot copper premiums narrowed considerably, and some cargo-holders of standard-quality copper even offered discounts. Spot copper offers were between discounts of negative RMB 30/mt and premiums of positive RMB 70/mt in Shanghai in the morning business. Traded prices for standard-quality copper were between RMB 54,700-54,850/mt, and RMB 54,750-54,900/mt for high-quality copper. Spot copper supply remained stable, but consumption remained sluggish, leaving market in surpluses. In the afternoon, SHFE copper prices stabilized, but cargo-holders in spot markets had to settle accounts at the month-end, causing spot copper supply to decrease from the morning levels. Spot copper offers thus were between premiums of positive RMB 0-70/mt in the afternoon, while traded prices were little changed.  

Aluminum

The most active SHFE aluminum contract for October delivery started higher at RMB 15,160/mt and settled up RMB 355/mt or 2.37% at RMB 15,360/mt, after finding its high at RMB 15,390/mt. Positions dropped 3,494 lots to 123,850 lots. SMM expects the contract to struggle at RMB 15,200/mt for the near term lacking real support.

Spot aluminum was traded at RMB 15,400-15,430/mt in Shanghai, with low-iron aluminum trading at RMB 15,500-15,520/mt. The current-month contract surged some RMB 200/mt to above RMB 15,400/mt. Selling interest was strong but buying weak due to tight cash flows as well as poor demand, expanding spot discounts to RMB 30/mt and leaving trading light. The wait-and-see sentiment dominated the afternoon session as selling interest weakened amid rapidly climbing SHFE aluminum prices. Most deals were done at RMB 15,450/mt in the afternoon.

Lead

SHFE 1209 lead contract became the most actively traded one Thursday with prices opening RMB 125/mt higher at RMB 14,515/mt influenced by the positive economic data in the US. SHFE 1209 lead contract price stabilized at RMB 14,440/mt in the morning and hit an intraday high of RMB 14,525/mt in the afternoon as the US dollar index edged down, to finally close at RMB 14,515/mt , up RMB 125/mt. Trading volumes increased by 70 lots and positions were up 140 lots.

Spot lead prices in China’s domestic spot markets held firm. Well-known brands including Nanfang and Chengyuan were quoted between RMB 14,620-14,630/mt, with premiums of RMB 150-160/mt against the most active SHFE lead price. Shenqian was quoted at RMB 14,550/mt. Smelters remained unwilling to move goods, downstream buyers were more willing to buy at lower prices. Transactions improved compared with the previous trading day. In the afternoon, market was cautious ahead of the EU summit, so transactions turned modest.

Zinc

On Thursday, SHFE 1210 zinc contract prices opened at RMB 14,300/mt and fluctuated between RMB 14,240-14,310/mt in the morning session. In the midday, SHFE zinc prices rose slightly as the US dollar index plummeted. In the afternoon, as large numbers of shorts left the market with profit-taking, SHFE 1210 zinc contract prices rose further to touch an intraday high at RMB 14,385/mt, but fell later to close at RMB 14350/mt, up RMB 135/mt or 0.95%. Trading volumes decreased by 64,128 lots to 207,200 lots, and total position decreased by 9,036 lots to 213,348 lots.

In domestic spot markets, discounts of #0 zinc were between RMB 20-40/mt against SHFE 1210 zinc contract prices, with traded prices between RMB 14,230-14,250/mt. As SHFE zinc prices rose later the day, discounts of #0 zinc were around RMB 40/mt, with traded prices between RMB 14,260-14,280/mt. #1 zinc was quoted between RMB 14,230-14,250/mt. Downstream buying interest was low due to cash flow problems at the end of the month, and traders continued to move goods, but the overall transactions were muted.

Tin

In Shanghai tin market, spot tin prices were mainly between RMB 146,500-150,000/mt Thursday, and trading remained soft due to market fears. Tin prices kept falling with some goods traded at RMB 146,000/mt in the afternoon. Given the ample supply in the market, transactions were sparse. Mainstream traded prices for Nanshan and Jinlong were between RMB 146,300-146,400/mt, while Yunheng and Yunxi were mainly traded between RMB 147,000-147,200/mt. Quotation from Yunxi was still firm.

Nickel

On Thursday, mainstream prices of Jinchuan nickel were between RMB 121,500-121,700/mt, while mainstream Russian nickel prices were between RMB 118,100-118,400/mt. Traders were holding goods as profit margins for Jinchuan nickel narrowed, with transactions muted. But transactions of Russian nickel were brisk due to lower prices.