SMM Base Metals Daily Review (2013-10-18)

Price Review & Forecast 10:10:14AM Oct 21, 2013 Source:SMM

SHANGHAI, Oct. 21 (SMM) – 

Copper
Copper for delivery in January on the Shanghai Futures Exchange (SHFE), opened RMB 60/mt lower at RMB 52,020/mt October 18. The contract drifted higher after opening thanks to upbeat Chinese economic indicators, but failed to break through RMB 52,300/mt due to selloff at highs. The red metal fell back to RMB 52,100/mt later in the day before hitting a high of RMB 52,290/mt at the tail of the session. Finally, SHFE copper for January delivery ended up RMB 170/mt or 0.33% at RMB 52,250/mt. Trading volumes and positions contracted 49,966 lots and 3,194 lots, respectively. SHFE 1401 copper contract will remain range-bound for the near future.  
 
Spot copper in Shanghai was quoted at a contango of RMB 0-80/mt and a backwardation of RMB 0-20/mt over SHFE 1311 copper contract in the morning trading session. Traded prices were RMB 52,250-52,350/mt for standard-quality copper, and RMB 52,300-52,450/mt for high-quality copper. Cargo holders were in a rush to sell, causing backwardation to narrow. Prices of high-quality copper dropped due to plentiful supply. Contango of standard-quality copper widened slightly, though. Traders went bargain hunting, while purchases by downstream producers increased only marginally. In the afternoon, the continued selloff in spot copper market left resources offered at a contango of RMB 0-80/mt, with only quotes for Guixi copper managing to remain flat with SHFE current-month copper contract. Traded prices remained stable with morning session, but market saw mounting oversupply pressure. SHFE copper stocks increased by 10,524 mt to 172,109 mt last week, growing by over 20,000 mt in two weeks.

Aluminum
December aluminum on the Shanghai Futures Exchange (SHFE), the most active one, started last Friday higher at RMB 14,410/mt as markets were sanguine about upcoming Chinese economic indicators. The National Bureau of Statistics (NBS) announced China’s GDP grew 7.8% YoY and 2.2% MoM in Q3 and expressed optimism over the country’s economic prospects and labor market. This allowed SHFE 1312 aluminum contract to move above the daily moving average before noon. In the afternoon session, however, SHFE aluminum for December delivery dipped to RMB 14,350/mt before ending the day up RMB 30/mt at RMB 14,375/mt. Trading volumes decreased 2,014 lots to 2,372 lots, while positions also fell 1,644 lots to 61,802 lots. SHFE 1401 aluminum contract may shift to the most active contract this coming week.

Mainstream traded prices for spot aluminum in Shanghai were RMB 14,460-14,480/mt last Friday, beating other regions in east China due to tighter supply. Prices in Wuxi were RMB 14,430-14,440/mt early in the day, but then followed Shanghai up to RMB 14,460/mt. Prices held at RMB 14,430-14,440/mt in Hangzhou. Demand picked up as downstream producers restocked for the upcoming weekend. In the afternoon, cargo holders were little interested in moving goods, while demand picked up slightly, driving a slight uptick in traded prices. SHFE aluminum inventories grew from 6,594 mt to 214,627 mt last week, indicating growing supply and tempering gains of spot aluminum prices.

Lead
SHFE 1312 lead contract price, boosted by the soaring LME lead overnight, opened higher at RMB 14,350/mt last Friday. Later, as China’s Q3 GDP reportedly grew at annual rate of 7.8%, better than the 7.5% in Q2, SHFE lead for December delivery broke above RMB 14,000/mt driven by stronger buying support and move between RMB 14,380-14,420/mt, outperforming LME lead. In the afternoon trading session, however, risk aversion loomed in the market, dampening trading, with the most active SHFE lead contract closing the week at RMB 14,395/mt, up RMB 115/mt from Thursday. Trading volumes added 312 lots to 1,392 lots, and positions grew to an all-time high of 10,042 lots, up 496 lots. Investors remained bullish to SHFE lead. 
 
Quotations for spot lead in Shanghai varied largely. Quote for Jinsha was RMB 14,300/mt, a contango of RMB 100/mt against the most active SHFE lead contract price, with no transactions reported in the morning. Yunyue and Hanjiang were offered at RMB 14,230/mt and RMB 14,200/mt, respectively. Prices for Humon and Shenqian were between RMB 14,130-14,140/mt. Deals for deliverable goods were hardly made as traders purchased a considerable amount of such resources in the past two days. Most transactions were done at low prices.

Zinc
SHFE 1401 zinc contract prices opened at RMB 14,930/mt, and then souring to RMB 14,985/mt, but meeting resistance at RMB 15,000/mt. Market players turned cautious at the week’s end. SHFE zinc prices remained between RMB 14,950-14,980/mt, closing at RMB 14,950/mt, up RMB 30/mt or 0.20%. Trading volumes decreased by 4,422 lots, to 37,274 lots, and total positions decreased by 15,904 lots, to 129,018 lots. Total positions of SHFE 1401 zinc contracts decreased by 15,904 lots in the week.

#0 zinc prices were between RMB 15,050-15,110/mt, with spot premiums narrowing RMB 20/mt, to RMB 100-150/mt against SHFE 1401 zinc contract prices. #1 zinc prices were around RMB 15,000/mt. SHFE 1401 zinc contract prices moved between RMB 14,940-14,980/mt. A wait-and-see attitude increased in the market, with spot prices lacking ability to rise, and spot premiums narrowing, and with trading muted. Shuangyan branded #0 zinc prices were RMB 15,100-15,110/mt, with Baohui brand traded at RMB 15,050/mt, and Qinxin and Qilin branded zinc ingot was traded between RMB 15,060-15,080/mt.

Tin
In Shanghai spot tin market, traded prices were mainly between RMB 146,500-150,500/mt October 18. Prices on brands from Jiangxi province fell to RMB 146,500-147,500/mt, and resources of Yunnan Tin Group were sold at RMB 150,000-150,500/mt. China’s spot tin prices were largely dragged down by tumbling LME tin prices overnight, with market shrouded in depression. Despite a marginal rebound in LME tin Friday afternoon, spot tin market remained anemic, and trading was quiet. 

Nickel
In Shanghai, SMM #1 zinc prices were between RMB 97,100-98,100/mt, with transactions quiet and traded prices within SMM price range.  Traders watched on the sidelines as LME nickel prices leveled out, downstream buyers purchased on an as-needed basis.
 

 

Key Words:  SHFE copper prices   aluminum   lead   zinc   tin   nickel  

SMM Base Metals Daily Review (2013-10-18)

Price Review & Forecast 10:10:14AM Oct 21, 2013 Source:SMM

SHANGHAI, Oct. 21 (SMM) – 

Copper
Copper for delivery in January on the Shanghai Futures Exchange (SHFE), opened RMB 60/mt lower at RMB 52,020/mt October 18. The contract drifted higher after opening thanks to upbeat Chinese economic indicators, but failed to break through RMB 52,300/mt due to selloff at highs. The red metal fell back to RMB 52,100/mt later in the day before hitting a high of RMB 52,290/mt at the tail of the session. Finally, SHFE copper for January delivery ended up RMB 170/mt or 0.33% at RMB 52,250/mt. Trading volumes and positions contracted 49,966 lots and 3,194 lots, respectively. SHFE 1401 copper contract will remain range-bound for the near future.  
 
Spot copper in Shanghai was quoted at a contango of RMB 0-80/mt and a backwardation of RMB 0-20/mt over SHFE 1311 copper contract in the morning trading session. Traded prices were RMB 52,250-52,350/mt for standard-quality copper, and RMB 52,300-52,450/mt for high-quality copper. Cargo holders were in a rush to sell, causing backwardation to narrow. Prices of high-quality copper dropped due to plentiful supply. Contango of standard-quality copper widened slightly, though. Traders went bargain hunting, while purchases by downstream producers increased only marginally. In the afternoon, the continued selloff in spot copper market left resources offered at a contango of RMB 0-80/mt, with only quotes for Guixi copper managing to remain flat with SHFE current-month copper contract. Traded prices remained stable with morning session, but market saw mounting oversupply pressure. SHFE copper stocks increased by 10,524 mt to 172,109 mt last week, growing by over 20,000 mt in two weeks.

Aluminum
December aluminum on the Shanghai Futures Exchange (SHFE), the most active one, started last Friday higher at RMB 14,410/mt as markets were sanguine about upcoming Chinese economic indicators. The National Bureau of Statistics (NBS) announced China’s GDP grew 7.8% YoY and 2.2% MoM in Q3 and expressed optimism over the country’s economic prospects and labor market. This allowed SHFE 1312 aluminum contract to move above the daily moving average before noon. In the afternoon session, however, SHFE aluminum for December delivery dipped to RMB 14,350/mt before ending the day up RMB 30/mt at RMB 14,375/mt. Trading volumes decreased 2,014 lots to 2,372 lots, while positions also fell 1,644 lots to 61,802 lots. SHFE 1401 aluminum contract may shift to the most active contract this coming week.

Mainstream traded prices for spot aluminum in Shanghai were RMB 14,460-14,480/mt last Friday, beating other regions in east China due to tighter supply. Prices in Wuxi were RMB 14,430-14,440/mt early in the day, but then followed Shanghai up to RMB 14,460/mt. Prices held at RMB 14,430-14,440/mt in Hangzhou. Demand picked up as downstream producers restocked for the upcoming weekend. In the afternoon, cargo holders were little interested in moving goods, while demand picked up slightly, driving a slight uptick in traded prices. SHFE aluminum inventories grew from 6,594 mt to 214,627 mt last week, indicating growing supply and tempering gains of spot aluminum prices.

Lead
SHFE 1312 lead contract price, boosted by the soaring LME lead overnight, opened higher at RMB 14,350/mt last Friday. Later, as China’s Q3 GDP reportedly grew at annual rate of 7.8%, better than the 7.5% in Q2, SHFE lead for December delivery broke above RMB 14,000/mt driven by stronger buying support and move between RMB 14,380-14,420/mt, outperforming LME lead. In the afternoon trading session, however, risk aversion loomed in the market, dampening trading, with the most active SHFE lead contract closing the week at RMB 14,395/mt, up RMB 115/mt from Thursday. Trading volumes added 312 lots to 1,392 lots, and positions grew to an all-time high of 10,042 lots, up 496 lots. Investors remained bullish to SHFE lead. 
 
Quotations for spot lead in Shanghai varied largely. Quote for Jinsha was RMB 14,300/mt, a contango of RMB 100/mt against the most active SHFE lead contract price, with no transactions reported in the morning. Yunyue and Hanjiang were offered at RMB 14,230/mt and RMB 14,200/mt, respectively. Prices for Humon and Shenqian were between RMB 14,130-14,140/mt. Deals for deliverable goods were hardly made as traders purchased a considerable amount of such resources in the past two days. Most transactions were done at low prices.

Zinc
SHFE 1401 zinc contract prices opened at RMB 14,930/mt, and then souring to RMB 14,985/mt, but meeting resistance at RMB 15,000/mt. Market players turned cautious at the week’s end. SHFE zinc prices remained between RMB 14,950-14,980/mt, closing at RMB 14,950/mt, up RMB 30/mt or 0.20%. Trading volumes decreased by 4,422 lots, to 37,274 lots, and total positions decreased by 15,904 lots, to 129,018 lots. Total positions of SHFE 1401 zinc contracts decreased by 15,904 lots in the week.

#0 zinc prices were between RMB 15,050-15,110/mt, with spot premiums narrowing RMB 20/mt, to RMB 100-150/mt against SHFE 1401 zinc contract prices. #1 zinc prices were around RMB 15,000/mt. SHFE 1401 zinc contract prices moved between RMB 14,940-14,980/mt. A wait-and-see attitude increased in the market, with spot prices lacking ability to rise, and spot premiums narrowing, and with trading muted. Shuangyan branded #0 zinc prices were RMB 15,100-15,110/mt, with Baohui brand traded at RMB 15,050/mt, and Qinxin and Qilin branded zinc ingot was traded between RMB 15,060-15,080/mt.

Tin
In Shanghai spot tin market, traded prices were mainly between RMB 146,500-150,500/mt October 18. Prices on brands from Jiangxi province fell to RMB 146,500-147,500/mt, and resources of Yunnan Tin Group were sold at RMB 150,000-150,500/mt. China’s spot tin prices were largely dragged down by tumbling LME tin prices overnight, with market shrouded in depression. Despite a marginal rebound in LME tin Friday afternoon, spot tin market remained anemic, and trading was quiet. 

Nickel
In Shanghai, SMM #1 zinc prices were between RMB 97,100-98,100/mt, with transactions quiet and traded prices within SMM price range.  Traders watched on the sidelines as LME nickel prices leveled out, downstream buyers purchased on an as-needed basis.
 

 

Key Words:  SHFE copper prices   aluminum   lead   zinc   tin   nickel