SHANGHAI, Oct. 14 (SMM) – The most active SHFE 1412 copper contract swung by less than RMB 300/mt during Monday’s night session after starting at RMB 47,860/mt, meeting resistance at the RMB 48,000/mt mark. The price of the contract closed the night session up RMB 290/mt at RMB 47,850/mt. Trading volumes for the SHFE 1412 copper contract fell fractionally to some 150,000 lots, but positions added by 5,576 lots.
On Tuesday, SHFE copper fell initially as low as RMB 47,770/mt, but rebounded during the afternoon trading session to RMB 48,220/mt before ending up RMB 540/mt, or 1.14%, at RMB 48,100/mt. Trading volumes for the most active contract shrank by 115,000 lots, and positions decreased by 7,010 lots.
Physical copper in Shanghai was quoted Tuesday at a RMB 0-120/mt discount to the SHFE 1410 copper contract. Traded prices were RMB 48,400-48,520/mt for standard-quality copper and RMB 48,460-48,600/mt for high-quality copper.
As SHFE copper edged up on Tuesday, the price gap between the SHFE 1410 and 1411 copper contracts remained at around RMB 300/mt. After the SHFE/LME copper price ratio leveled out, a variety of imported copper brands flocked to the market. Cargo holders rushed to sell ahead of the delivery for the SHFE front-month copper contract, with physical copper quoted at a discount across the board.
Cargo holders became disinclined to move goods at high discounts as the price gap between the SHFE 1410 and 1411 copper contracts narrowed subsequently. A small number of speculative traders entered the market to go bargain-hunting. Meanwhile, most downstream producers were buying only to need despite brisk enquiries. Trading activity improved slightly on Tuesday.