SHANGHAI, Oct. 28 (SMM) – SHFE 1401 copper contract prices started RMB 70/mt higher at RMB 51,750/mt on Friday, as LME copper rallied overnight. The red metal then only moved between RMB 51,600-51,800/mt due to thin trading activities. In the afternoon session, plunging LME copper and a 1.9% decline in China’s A-shares sparked massive selloff, sending SHFE 1401 copper contract all the way down to RMB 51,100/mt. Finally, SHFE copper for January delivery ended down RMB 530/mt or 1.03% at RMB 51,150/mt. Trading volumes were off 24,964 lots, but positions were up 32,398 lots. Market believed support for SHFE copper will be lower at RMB 50,800/mt after the prices fell below RMB 51,500/mt. Further declines are on the way for the red metal.
Spot copper in Shanghai was quoted at a contango of RMB 0-100/mt and a backwardation of RMB 0-10/mt over SHFE 1311 copper contract on Friday. Traded prices were RMB 51,780-51,840/mt for standard-quality copper, and RMB 51,820-51,920/mt for high-quality copper. Contango narrowed, especially for standard-quality copper. Backwardation was reported only for Guixi copper. Traders and downstream producers purchased modest amounts of goods at the bottom. In the afternoon, falling SHFE copper prompted arbitragers to sell aggressively, with spot copper offered between a contago of RMB 100 and a backwardation of RMB 20/mt. Some traders bought in spot markets and sold futures, and a few downstream buyers also purchased at lows, with spot trading improving. Traded prices were between RMB 51,500-51,700/mt. SHFE copper stocks edged up 37 lots to 172,146 lots last week.