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SMM Base Metals Market Daily Review (2014-4-9)
Apr 10,2014 10:07CST
price review forecast
The most active SHFE copper contract price leveled out after starting at RMB 46,580/mt, and ended up RMB 60/mt at a high of RMB 46,790/mt during Tuesday’s night session.

SHANGHAI, Apr. 10 (SMM) –

The most active SHFE copper contract price leveled out after starting at RMB 46,580/mt, and ended up RMB 60/mt at a high of RMB 46,790/mt during Tuesday’s night session. Traded volumes stood at some 100,000 lots, and positions gained by 6,008 lots. On Wednesday, SHFE copper prices fell to RMB 46,600/mt in the afternoon trading hours after encountering resistance at RMB 46,840/mt, and broke below RMB 46,500/mt at the tail of the trading. The red metal closed down RMB 350/mt, or 0.75%, at an intraday low of RMB 46,380/mt on Wednesday. Traded volumes added by 83,406 lots, while positions expanded by 13,558 lots. SHFE copper prices have been trapped between the 5-day and 10-day moving averages, and should test support at RMB 46,500/mt in the near term.

In the Shanghai physical market, copper was offered Wednesday at a premium of RMB 190-280/mt. Traded prices were RMB 47,480-47,540/mt for standard-quality copper and RMB 47,540-47,620/mt for high-quality copper. SHFE copper prices lacked impetus to bounce back, while losses from copper imports also narrowed after the SHFE/LME copper price ratio recovered. As the delivery date neared, the price gap between the SHFE 1404 copper contract and the SHFE 1405 copper contract also expanded to some RMB 300/mt. As a result, a large number of cargo holders sold off goods, with a variety of copper brands available in the market. Physical premiums narrowed abruptly, but hydro-copper prices were virtually the same as those for standard-quality copper. Downstream producers purchased goods only on an as-needed basis. Middlemen largely bought physical copper and sold futures on Wednesday.

On Tuesday night, SHFE 1406 aluminum contract crept higher to RMB 13,130/mt after starting at RMB 13,075/mt, and finished the night session at RMB 13,130/mt. Trading volumes totaled 4,666 lots, and positions gained 302 lots to 124,044 lots. On Wednesday, the most active contract slid to RMB 13,035/mt before ending the daytime trading hours RMB 55/mt lower at RMB 13,060/mt. Trading volumes totaled 15,126 lots, and positions contracted 420 lots to 123,322 lots.

Spot aluminum largely traded at RMB 12,770-12,780/mt in Shanghai and Wuxi, and RMB 12,780-12,790/mt in Hangzhou on Wednesday. SHFE 1404 aluminum contract lacked upward momentum, leaving sellers anxious to sell. Traders were cautious about buying, while downstream producers bought only to need. In the afternoon, sparse quotations were reported at RMB 12,770/mt, but trading was muted.

The most active SHFE 1405 lead contract price started at RMB 13,720/mt, and then followed LME lead prices up to close up RMB 25/mt at RMB 13,750/mt during Tuesday’s night session. Traded volumes were 212 lots, while positions gained 58 lots to 6,494 lots. On Wednesday, SHFE lead prices rose as high as RMB 13,760/mt, facing resistance at the 10-day moving average, but pulled back at the tail of the trading to a low of RMB 13,735/mt. The metal finished up RMB 25/mt at RMB 13,750/mt. Traded volumes were 774 lots, and positions were off 122 lots to 6,314 lots. The most active SHFE lead contract price is expected to test resistance at the 20-day moving average in the near term, boosted by strength in physical lead prices.

In the Shanghai physical lead market, goods from Chihong Zn & Ge traded mostly Wednesday at RMB 13,730/mt, a discount of around RMB 10-20/mt over SHFE 1405 lead contract prices. A certain amount of resources from Chihong Zn & Ge were sold as high as RMB 13,750/mt due to tight supply, while Humon traded between RMB 13,700-13,720/mt. Smelters moved goods only in light volumes, causing shortage of physical lead in the Shanghai market. Downstream producers reverted to a wait-and-see posture Wednesday when lead prices rose, with modest transactions.

The most active SHFE 1406 zinc contract price rose to a high of RMB 14,950/mt after starting at RMB 14,910/mt, and closed up RMB 60/mt, or 0.4%, at RMB 14,950/mt during Tuesday’s night session.

On Wednesday, SHFE 1406 zinc contract prices opened at RMB 14,945/mt, and hovered most of the day between RMB 14,930-14,945/mt. The metal fell slightly at the tail of the trading to a new intraday low of RMB 14,915/mt, and finished up RMB 40/mt, or 0.27%, at RMB 14,930/mt. Traded volumes lost 1,794 lots to 14,154 lots, while positions shed 2,334 lots to 65,206 lots.

In the Shanghai physical market, #0 zinc ingot traded Wednesday mostly between RMB 14,810-14,830/mt, a discount of RMB 110-130/mt over the most active SHFE 1406 zinc contract price. Traded prices for #1 zinc ingot were around RMB 14,780/mt. Zinc smelters were reluctant to move goods, while some of them planned maintenance. Downstream producers, however, ramped up purchases due to the seasonally brisk consumption period and eased liquidity. Some zinc brands were in short supply, helping support physical prices, and price gap between various brands narrowed. Physical zinc prices followed the most active SHFE zinc contract price up on Wednesday, with discounts essentially unchanged from Tuesday. Downstream purchases were sluggish due to high zinc prices and following intensive restocking activity on Tuesday, with worse transactions. Traded prices were RMB 14,820-14,830/mt for Shuangyan branded #0 zinc and RMB 14,810-14,820/mt for Yuguang, Feilong, and Jiulong branded #0 zinc.

In Shanghai physical tin market, mainstream traded prices were RMB 138,500-139,500/mt on Wednesday. Some offered at RMB 138,000/mt, but such cheap goods were quickly sold out. Yunxi brand tin was offered higher at RMB 140,000/mt, but such high price depressed buying interest. Overall trading was modest.

In Shanghai, SMM #1 nickel prices were between RMB 108,700-109,600/mt. Jinchuan raised nickel prices by RMB 1,000/mt, to RMB 110,000/mt. Domestic spot nickel prices rose sharply, prompting traders to actively trade. Jinchuan nickel prices climbed to RMB 110,500/mt in the afternoon, and transactions for Russian nickel were mainly made in the morning, with prices between RMB 108,500-108,700/mt.

SHFE copper prices
SHFE aluminum prices
lead prices
zinc prices
tin prices
nickel prices

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