SHANGHAI, Jan. 28 (SMM) – With LME copper holding flat overnight, SHFE 1305 copper contract started RMB 20/mt up at RMB 58,610/mt January 25. As LME copper prices rebounded to USD 8,100/mt, the contract rose all the way amid buying support, but fluctuated narrowly at highs after suffering resistance at levels around RMB 59,000/mt, with a low at merely RMB 58,600/mt. The Shanghai Composite Index struggling at 2,300 during the day gave some pressures to SHFE copper prices, which slightly narrowed gains at the tail of trading. SHFE 1305 copper contract closed at RMB 58,830/mt, still up RMB 240/mt or 0.41%, with trading volumes down 14,678 lots but positions up 17,278 lots. With increasing buying support and trying to shake off pressures at recent daily moving averages, SHFE copper prices are likely to rebound for the foreseeable future.
With SHFE copper prices stabilizing, Shanghai spot copper discounts were between negative RMB 120-240/mt in the morning business. Traded prices for standard-quality copper were between RMB 58,020-58,120/mt, and RMB 58,100-58,220/mt for high-quality copper. Traders chose to buy at lows in the morning, helping enliven market transactions. Copper discounts expanded near the midday when spot copper pries stood above RMB 58,000/mt, and as cargo-holders stepped up sale volumes at highs. High-quality copper still dominated spot copper supply, which remained plentiful. However, downstream producers refrained from purchasing following copper price increases. Therefore, overall copper market transactions dropped after initially rising. In the afternoon, SHFE copper prices fluctuated near existing levels, but copper supply decreased, helping copper discounts narrow to negative RMB 120-200, but traded prices held firm above RMB 58,000/mt. SHFE copper stocks fell by 3,448 mt to 205,120 mt, a sign that downstream producers did not replenish stocks in large quantities.