SHANGHAI, Feb. 20 (SMM) – With LME copper extending losses overnight, SHFE 1305 copper contract, the most active one, opened RMB 330/mt down at RMB 58,840/mt Tuesday. The contract continued to slide following the opening, but stabilized after gaining temporary support at the 30-day moving average. SHFE copper prices gradually pared daily losses as investors bought at lows, but with strong resistance at around RMB 59,100/mt. In the afternoon, as LME copper dropped from highs and lost USD 8,100/mt, and since the Shanghai Composite Index dipped below 2,400, SHFE copper prices slipped below the daily moving average and touched a low at RMB 58,700/mt. SHFE 1305 copper contract settled RMB 390/mt or 0.66% lower at RMB 58,780/mt, with trading volumes down 31,364 lots and positions up 1,938 lots. As SHFE copper market trading sentiment abated, and since LME copper prices completely lost the 30-day moving average, SHFE copper prices are likely to get back to a downside track after testing support at the 30-day moving average for the immediate future.
SHFE copper prices extended weakness, but spot copper discounts returned following the delivery for SHFE 1302 copper contracts. Hedged copper flew into spot markets and kept spot copper supply plentiful. In this context, copper discounts widened all the way, largely between RMB 130-250/mt in the morning business. Traded prices for standard-quality copper were between RMB 58,330-58,370/mt, and RMB 58,400-58,470/mt for high-quality copper. Domestic standard-quality copper cargo-holders became more willing to move goods for cash, so the price gap between standard and high-quality copper expanded. Traders’ buying interest abated, however, while downstream producers have yet to get back to markets. Actual market activity remained lackluster in the morning as a result. In the afternoon, SHFE copper prices continued weakness, but copper consumption dropped, causing copper discounts to expand to RMB 180-300/mt. Traded prices also declined to RMB 58,150-58,350/mt in the afternoon, but supply surplus was still pronounced.