SHANGHAI, Feb. 4 (SMM) –As the Shanghai Composite Index surged by 5.6% to a high of 2,421, SHFE copper prices rose 5.6% to RMB 59,740/mt. Total copper trading volumes on the SHFE grew by 340,000 lots and positions increased by nearly 30,000 lots.
In spot markets last week, with copper futures prices rebounding sharply, the SHFE/LME copper price ratio rose to around 7.3, which compelled imported copper cargo-holders to actively sell goods to generate cash. In response, spot copper discounts grew as copper supply remained plentiful. Downstream producers refrained from buying at prices above RMB 58,000/mt. Downstream purchases, however, improved slightly last Friday when copper prices fell marginally. Most downstream consumers chose to suspend production for the Chinese New Year holiday, while traders turned cautious towards purchasing. Market activity thus remained quiet.
In the coming week, SHFE copper prices are likely to challenge RMB 59,800-60,000/mt.