SHANGHAI, Apr. 2 (SMM) –
SHFE 1406 copper contract prices fared better than LME copper prices to start at RMB 46,650/mt, and then found support at RMB 46,630/mt during Monday’s night session. The red metal later encountered resistance at RMB 46,800/mt, and finished down RMB 20/mt, at RMB 46,760/mt. During the night trading session, trading volumes were down around 100,000 lots, but positions were up 3,116 lots. China’s official manufacturing PMI and HSBC’s China manufacturing PMI both came in negative, fueling wary sentiment in the market. SHFE 1406 copper contract prices held steady between RMB 46,600-46,900/mt, and closed down RMB 40/mt, or 0.09%, at RMB 46,740/mt on Tuesday. The SHFE 1407 copper contract became the most active contract on Tuesday. SHFE 1407 copper contract prices opened at RMB 46,580/mt, with the high end at RMB 46,580/mt and low end at RMB 46,520/mt, and closed down RMB 40/mt, or 0.09%, at RMB 46,630/mt. Trading volumes for the SHFE 1407 copper contract were down 158,000 lots, but positions were up 10,134 lots. SHFE copper prices are expected to trade in ranges in the near term on mixed technical indicators.
In the Shanghai physical market, copper was offered at a premium of RMB 90-150/mt on Tuesday. Traded prices were RMB 46,970-47,030/mt for standard-quality copper and RMB 47,000-47,070/mt for high-quality copper. Despite some improvement in liquidity conditions early April, cargo holders still were inclined to move goods to generate cash and inflated copper supply. High-quality and standard-quality copper prices were virtually the same, with middlemen and downstream producers mostly on guard. Market participants were concerned over the upside room in spot copper premiums in the near term. As SHFE copper prices stayed in ranges during the afternoon trading session, spot copper traded between RMB 46,950-47,100/mt, a premium of RMB 80-150/mt over SHFE current-month copper contract prices.
On Monday night, SHFE 1406 aluminum contract climbed to RMB 13,075/mt after starting at RMB 13,045/mt, but then surrendered gains to end the night session at RMB 13,065/mt. Trading volumes totaled 9,104 lots, and positions increased 926 lots to 119,592 lots. China’s official manufacturing PMI finalized at 50.3 in March, higher than the preliminary reading. However, HSBC’s final China manufacturing PMI for March was revised down to 48. The most active contract moved lower to RMB 13,000/mt on the heels of downbeat manufacturing data on Tuesday, closing the daytime session down RMB 15/mt at RMB 13,025/mt. Trading volumes totaled 13,578 lots, and positions were down 378 lots to 118,288 lots. The light metal should continue to test support at RMB 13,000/mt mark for the near future.
Spot aluminum largely traded at RMB 12,670-12,690/mt in Shanghai on Tuesday, RMB 12,680-12,690/mt in Wuxi and Hangzhou. Despite the pullback in SHFE 1404 aluminum contract prices, sellers in physical markets still held offers firm. Overall trading was modest. In the afternoon, suppliers held offers at RMB 12,670-12,680/mt, while buyers stayed out of the market.
The most active SHFE 1405 lead contract price fluctuated between RMB 13,740-13,750/mt after starting at RMB 13,735/mt, and closed down RMB 30/mt, at RMB 13,750/mt during Monday’s night session. Trading volumes were only 4 lots, and positions were off 2 lots to 7,214 lots. On Tuesday, SHFE 1405 lead contract prices hovered most of the day narrowly around RMB 13,730/mt. During the daytime trading session, trading volumes fell to 476 lots, and positions were off 18 lots to 7,198 lots on Tuesday.
In the Shanghai physical lead market, goods from Chihong Zn & Ge and Nanfang traded Tuesday between RMB 13,670-13,680/mt, a discount of around RMB 55/mt over SHFE 1405 lead contract prices. Humon resources were offered at RMB 13,680/mt, but were barely sold, while Shuangyan supply wrapped with iron sheet traded at RMB 13,630/mt. Chihong Zn & Ge and Humon did not move goods on Tuesday, while lead-acid battery producers still had little buying interest due to declines in SHFE lead prices and the absence of banking loans for April. Overall, trading activity was quite light.
SHFE 1406 zinc contract prices opened high at RMB 14,850/mt on Monday evening, and then touched RMB 14,855/mt before falling back, and closed at RMB 14,820/mt, down RMB 20/mt or 0.13%. Trading volumes decreased by 1,644 lots to 5,746 lots, and total positions increased by 822 lots to 74,398 lots. SHFE 1406 zinc contract prices opened low at RMB 14,820/mt on Tuesday, then fluctuated within a narrow range due to the lack of solid news, moving between RMB 14,805-14,830/mt, and closing the day at RMB 14,815/mt, down RMB 25/mt or 0.17%. Trading volumes decreased by 10,012 lots, to 13,570 lots, and total positions decreased by 196 lots, to 73,390 lots.
#0 zinc prices were between RMB 14,680-14,710/mt, with spot discounts between RMB 110-140/mt against SHFE 1406 zinc contract prices. #1 zinc prices were around RMB 14,640/mt. SHFE 1406 zinc contract prices opened at RMB 14,820/mt on Tuesday, and then moved between RMB 14,805-14,825/mt. Traders lacked interest in transactions as zinc prices fluctuated in an narrow band, and smelters were unwilling to move goods, with some brands still in short supply. Downstream enterprises took a wait-and-see attitude due to cash flow problem, with transactions muted. Shuangyan branded #0 zinc prices were around RMB 14,700/mt, with RMB 14,690/mt for Qinxin, Jiulong and Feilong branded #0 zinc. Baohui branded #0 zinc prices were around RMB 14,680/mt.
In Shanghai physical market, most transactions were between RMB 137,000-139,000/mt on Tuesday morning, while small amounts of Yunxi brand tin was offered higher at RMB 139,500/mt. In the afternoon, mainstream traded prices fell further to RMB 136,500-137,500/mt, and offers of Yunxi brand tin were also cut to RMB 139,000/mt. Consumption remained sluggish.
In Shanghai, SMM #1 nickel prices were between RMB 102,400-103,400/mt. Jinchuan raised nickel prices by RMB 700/mt to RMB 103,500/mt. Transactions made among traders were active. Due to weakening demand for finance-driven nickel imports, sliding Russian nickel imports and import tax, market players built Russian nickel stocks and were holding back goods, causing the price spread between Russian nickel and Jinchuan nickel to narrow to RMB 900/mt, with prices between RMB 102,800-103,600/mt in the afternoon.