SHANGHAI, Nov. 27 (SMM) –
Rising LME copper helped SHFE 1402 copper contract open RMB 110/mt higher at RMB 50,810/mt on Tuesday. The most active contract moved sideways near yesterday’s settlement price as selling pressure eased somewhat, with the low-end price at RMB 50,610/mt. SHFE copper for February delivery followed LME copper up to RMB 50,960/mt in late trading hours before falling back again to close the day RMB 90/mt or 0.18% higher at RMB 50,790/mt. Trading volumes soared 11,008 lots, while positions tumbled 18,894 lots. The red metal will continue to consolidate due to growing market caution.
Spot copper in Shanghai was quoted at a premium of RMB 90-180/mt over SHFE 1312 copper contract on Monday. Traded prices were RMB 51,020-51,100/mt for standard-quality copper, and RMB 51,080-51,160/mt for high-quality copper. Cargo holders were anxious to sell for cash, causing premium to narrow. Traders were wary of stepping in, with some buying spot copper while selling SHFE copper. Downstream producers watched from the sidelines at the beginning of the week. In the afternoon, premiums for spot copper continued to narrow SHFE copper rallying, some standard-quality copper was offered at discounts against SHFE current-month copper contract. Spot copper was primarily quoted between a contango of RMB 20/mt and a backwardation of RMB 50/mt. Traded prices were between RMB 50,950-51,050/mt. More purchases were made by both traders and downstream buyers.
SHFE 1402 aluminum contract, the most active one, opened at RMB 14,080/mt on Tuesday. Short-covering was reported after the contract slipped to RMB 14,070/mt, pushing the light metal back to near its opening price. In the afternoon session, SHFE aluminum for February delivery followed SHFE copper up to RMB 14,110/mt before falling back again to finish RMB 15/mt lower at RMB 14,095/mt. Trading volumes added 532 lots to 4,900 lots, and positions also increased 624 lots to 50,462 lots.
Spot aluminum prices were RMB 14,320-14,330/mt in Shanghai on Tuesday, a premium of RMB 60-70/mt over SHFE 1312 aluminum contract. Prices were RMB 14,310-14,330/mt in Wuxi, and RMB 14,310-14,320/mt in Hangzhou. Arrivals into east China grew, especially in Wuxi, sending prices down. Downstream producers continued to buy to need, and traders were also wary of purchasing. In the afternoon, some restocked in small amounts, with traded prices reported at RMB 14,330/mt.
The most-traded SHFE 1401 lead price started at RMB 13,940/mt and fluctuated narrowly in a range of RMB 13,930-14,000/mt on Tuesday. In Asian trading hours, LME lead price tentatively stabilized, pushing up SHFE lead price to end, RMB 10/mt, or 0.07% higher, at RMB 13,970/mt. Trading volume expanded 442 lots to 970 lots, whereas open interest shed 142 lots to 10,454 lots. SHFE lead price stabilizes around the 5-day moving average and finds solid support at the lower Bollinger Band on Tuesday.
In China’s spot lead market, goods of Chihong Zn & Ge traded at RMB 13,900, a discount of RMB 50/mt over the most active SHFE lead price on Tuesday. Nanfang and Chengyuan resources were still offered on a par with SHFE 1312 lead price, and mostly traded in a RMB 13,870-13,880/mt band. Shuangyan and Humon were sold at RMB 13,850/mt. Affected by lead smelters which were reluctant to trade, most cargo holders moved goods at firm prices, while downstream producers still had little buying interest due to tight liquidity and fears that lead price might fall further, leaving transactions light on Tuesday.
SHFE 1402 zinc contract prices opened lower at RMB 14,860/mt, dragged down by LME zinc prices overnight, then leveling out between RMB 14,830-14,855/mt, with strong support from the 10-day moving average. Finally, SHFE zinc prices closed the day at RMB 14,845/mt, up RMB 15/mt. Trading volumes decreased by 916 lots, to 18,816 lots, and total positions decreased by 1,260 lots, to 114,000 lots.
#0 zinc prices were between RMB 14,910-14,940/mt, with spot premiums between RMB 70-100/mt against SHFE 1402 zinc contract prices. Lida branded #1 zinc prices were between RMB 14,880-14,890/mt, with spot premiums SMC branded zinc RMB 50-60/mt against SHFE 1402 zinc contract prices, trading between RMB 14,890-14,900/mt. SHFE 1402 zinc contract prices opened high but moved lower, leveling out around RMB 14,860/mt, depressing market sentiment. Smelters moved goods normally, and traders were actively moving goods to generate cash, but downstream buying interest remained low, leaving transactions muted.
Spot tin prices in Shanghai dropped Tuesday morning to RMB 142,500-145,500/mt, but a few resources with low lead content produced by Yunnan Tin Group were sold higher at RMB 145,800-146,000/mt. Yunshan and Yunxiang were traded at RMB 143,000/mt. Transactions for Nanshan and Jinlong were concluded at RMB 142,500/mt. In the afternoon, traded price for Jinlong fell to RMB 142,000/mt with more cheap resources available in the market. Gloominess dominated the market, and trading was quite thin.
In Shanghai, SMM #1 nickel prices were between RMB 94,100-95,100/mt, with transactions muted and mainly made by downstream buyers. Jinchuan nickel prices were between RMB 95,000-95,200/mt, with trades mainly made around RMB 95,000/mt, and Russian nickel prices were between RMB 93,900-94,100/mt, with mainstream prices around RMB 94,000/mt.