SHANGHAI, Aug. 18 (SMM) – The most active SHFE 1410 copper contract followed LME copper prices down to RMB 48,620/mt after starting Thursday’s night session at RMB 48,840/mt, and closed down RMB 290/mt at RMB 48,740/mt. During the night session, trading volumes for the most active contract were 150,000 lots, and positions gained by 476 lots.
On Friday, SHFE copper prices failed to break above the RMB 49,000/mt mark during the morning trading session, but then surged to a high of RMB 49,150/mt subsequently. The price of the red metal fell back at the tail of the trading to close down RMB 120/mt, or 0.24%, at RMB 48,910/mt. Trading volumes for the SHFE 1410 copper contract shed by 32,918 lots, and positions decreased by 6,960 lots.
In the Shanghai physical market, copper was quoted Friday between a RMB 60/mt discount and a RMB 80/mt premium over the SHFE 1408 copper contract. Traded prices were RMB 49,250-49,360/mt for standard-quality copper and RMB 49,260-49,400/mt for high-quality copper.
The price gap between the SHFE 1408 and 1409 copper contracts remained at around RMB 150/mt in the last trading day for the front-month copper contract. Imported copper began flowing into the market after the SHFE/LME copper price ratio rebounded to 7.15, with supply being sufficient. Middlemen entered the market to buy. As the price gap narrowed to less than RMB 100/mt and SHFE copper prices steadied, most cargo holders pushed up physical premiums. Middlemen were largely conducting short-term transactions, while downstream producers hunted for bargains ahead of the weekend, with improved trading activity.
As SHFE copper prices steadied during the afternoon trading session, cargo holders continued to push up physical premiums. Copper was offered largely at a RMB 60-120/mt premium and traded at RMB 49,350-49,450/mt. Middlemen entered the market to buy to satisfy demand under long-term contracts, with standard-quality copper supply down. A small number of cargo holders quoted prices at a RMB 40-80/mt over the SHFE 1409 copper contract. SHFE copper inventories shed 4,093 mt to 96,853 mt since downstream producers stepped up hunting for bargains following a fall in copper prices.