SHANGHAI, Jun 3 (SMM) –
The most active SHFE copper contract dipped to a low RMB 48,370/mt after starting lower at RMB 48,400/mt during Thursday’s night session, and ended down RMB 250/mt at RMB 48,470/mt. During the night session, traded volumes for the most active contract remained unchanged at around 100,000 lots, while positions lost 2,504 lots. On Friday, SHFE copper prices initially hovered around RMB 48,500/mt, and then sank to RMB 48,270/mt. The metal bounced back at the tail of the trading due to some buying support, and closed down RMB 80/mt, or 0.16%, at RMB 48,640/mt on Friday. Traded volumes for the SHFE 1408 copper contract gained 88,436 lots, while positions lost 11,038 lots. Traded volumes for the SHFE 1407 copper contract added 20,632 lots, and positions shed 21,902 lots. Traded volumes for the SHFE 1409 copper contract increased 30,080 lots, while positions expanded 10,332 lots.
In the Shanghai physical market, copper was offered Friday at a RMB 200-340/mt premium over the SHFE front-month copper contract. Traded prices were RMB 49,570-49,670/mt for standard-quality copper and RMB 49,670-49,770/mt for high-quality copper. SHFE copper prices extended losses in the last trading day in May, and imported copper brands continued to dominate the physical market, which put a dent in copper premiums. A RMB 150/mt fall in SHFE copper prices later prompted downstream producers to buy the dips, with brisker trading activity, while middlemen also entered the market to purchase goods. As SHFE copper prices stabilized during the afternoon trading session, most industry insiders stayed out of the market, causing copper supply to fall sharply, with standard-quality copper barely found in the market. Copper was largely quoted at a RMB 260-350/mt premium and traded slightly higher in the RMB 49,670-49,800/mt range. SHFE copper inventories decreased 705 mt to 91,947 mt.
Last Thursday night, SHFE 1408 aluminum contract climbed to RMB 13,400/mt after starting at RMB 13,375/mt, and finished the night session at RMB 13,430/mt. Trading volumes totaled 24,882 lots, with positions up 4,422 lots to 130,172 lots. On Friday, the most active contract jumped to RMB 13,550/mt before ending the day up RMB 70/mt at RMB 13,530/mt. Trading volumes surged 51,066 lots to 75,948 lots, with positions up 5,510 lots to 135,682 lots.
Spot aluminum in Shanghai largely traded between RMB 13,290-13,300/mt Friday morning, a discount of RMB 70-80/mt over SHFE 1406 aluminum contract. Mainstream traded prices were RMB 13,280-13,300/mt Wuxi and RMB 13,330-13,350/mt in Hangzhou. Sellers were eager to sell as month-end liquidity crunch bit in and since the three-day holiday is around the corner. Demand picked up slightly ahead of the holiday. SHFE front-month aluminum contract rallied at the tail of trading, but transactions in physical market, with prevailing traded prices at RMB 13,290-13,300/mt.
The most active SHFE 1407 lead contract started significantly lower during Thursday’s night session and then advanced to around RMB 14,000/mt before ending down RMB 15/mt at RMB 13,995/mt. During the night session, a total of 242 lots were traded, among which 184 lots were traded for the SHFE 1408 lead contract. On Friday, SHFE lead prices hovered steadily between RMB 14,000-14,010/mt during the morning trading session, but fell slightly during the afternoon trading session to finish down RMB 30/mt at RMB 13,980/mt. Traded volumes amounted to only 232 lots, while positions lost 76 lots to 4,950 lots.
In the Shanghai physical lead market, traded prices for Chihong Zn & Ge brand initially were RMB 13,950/mt, but later fell to RMB 13,930-13,940/mt, a RMB 60-70/mt discount over the most active SHFE 1407 lead contract. Traded prices were RMB 13,940/mt for Nanfang resources and RMB 13,920-13,930/mt for Humon and Shuangyan supply wrapped with plastic sheet. Goods from Shuangyan brand wrapped with iron sheet were sold at RMB 13,900/mt. Cargo holders expressed strong willingness to discount goods on tight liquidity and supply overhangs, while downstream producers had extremely low buying interest on Friday. High pile-up of finished goods inventories and the arrival of the Dragon Boat Festival combined to hurt demand.
SHFE 1408 zinc contract prices opened at RMB 15,105/mt last Thursday evening, then dropped to RMB 15,100/mt before rising, and closing at RMB 15,135/mt, down RMB 50/mt or 0.33%. SHFE 1408 zinc contract prices opened at RMB 15,140/mt on Friday, then hovered between RMB 15,120-15,170/mt due to muted transactions, and closing at RMB 15,150/mt, down RMB 35/mt or 0.23%. Trading volumes decreased by 7,610 lots, to 12,680 lots, and total positions increased by 636 lots, to 68,710 lots.
#0 zinc prices were between RMB 15,130-15,160/mt, with spot prices ranging from RMB 20/mt below to RMB 10/mt against SHFE 1408 zinc contract prices. #1 zinc prices were between RMB 15,100-15,120/mt, with Shuangyan branded #0 zinc between RMB 15,140-15,160/mt. Regular brands #0 zinc prices were between RMB 15,130-15,150/mt, with RMB 15,190-15,200/mt for Yuguang, Qinxin and Jiulong branded #0 zinc. AZ branded #0 zinc prices were RMB 15,120-15,130/mt. SHFE 1408 zinc contract prices fluctuated around RMB 15,165/mt during the first trading session, with spot discounts between RMB 0-20/mt against SHFE 1408 zinc contract prices. SHFE 1408 zinc contract prices inched down to RMB 15,125/mt in the second trading session, with spot prices firm and RMB 0-10/mt above SHFE 1408 zinc contract prices. Traders lacked interest in operations as they were busy settling accounts, while downstream buyers also had built stocks, leaving transactions muted. SHFE 1408 zinc contract prices fell slightly in the afternoon, but spot prices remained largely unchanged, with transactions quiet as downstream buyers mostly left the market before the holiday. Shuangyan branded #0 zinc prices were around RMB 15,160/mt, and regular brands #0 zinc prices were around RMB 15,150/mt.
Spot tin prices in Shanghai were between RMB 139,000-140,500/mt, with supply at the low-end of the price range increasing. But due to sluggish demand, transactions were quiet. both sellers and buyers stood on the sidelines.
SMM #1 nickel prices were quoted between RMB 132,500-133,000/mt. Transactions were muted as traders lacked interest in operations, and since downstream buying interest was also low, with traded prices between RMB 131,800-132,200/mt.