SHANGHAI, Jan. 14 (SMM) –

Copper
Copper for March delivery on the Shanghai Futures Exchange, the most active contract, started Monday’s night session at RMB 43,400/mt and later dipped to RMB 43,240/mt. The price of the SHFE 1503 copper contract leveled out to RMB 43,450/mt afterwards and finished down RMB 630/mt at RMB 43,510/mt. During the night session, trading volumes for the most active contract amounted to 180,000 lots, while positions decreased by 4,770.

SHFE copper initially rebounded to hover narrowly around RMB 44,600/mt and then met resistance at RMB 43,700/mt on Tuesday. The price of the red metal fell again by the midday and slid to RMB 42,880/mt at the tail of the trading before ending down RMB 1,250/mt, or 2.83% at RMB 42,890/mt. Trading volumes for the SHFE 1503 copper contract gained 282 lots, while positions added by 8,040. Trading volumes for the SHFE 1504 copper contract increased by 25,816 lots, while positions rose by 16,470 lots. Trading volumes for the SHFE 1505 copper contract increased by 11,228 lots, and positions rose by 11,834.

Spot copper in Shanghai was quoted Tuesday at a RMB 100-180/mt discount to the SHFE 1501 copper contract. Standard- and high-quality copper sold for RMB 44,120-44,300/mt and RMB 44,150-44,350/mt, respectively. The SHFE/LME copper price ratio fell sharply on Tuesday, leading to a decline in the proportion of imported copper supply in the market. Spot discounts narrowed slightly by the midday as copper prices slid by nearly RMB 200/mt. Middlemen were not active, while downstream producers cut purchases on Tuesday, leaving trading worse than Monday.

Some downstream producers started to buy under term contracts in the afternoon trading when SHFE copper trended lower. The resulting decrease in supply caused spot discounts to narrow. The market was dominated by standard-quality copper, with few quotations for high-quality copper. Spot copper was offered at a RMB 80-150/mt discount and traded lower at RMB 43,700-44,100/mt.

Aluminum
On Monday night, SHFE 1503 aluminum contract started lower at RMB 12,705/mt, and finished the night session at RMB 12,735/mt. Trading volumes totaled 17,560 lots, with positions up 1,484 to 163,642.

The most active contract was range bound for most of Tuesday, gathering little momentum from better-than-expected December Chinese trade data. The contact fell to RMB 12,685/mt later in the day, but bounced back to RMB 12,770/mt immediately as some bears exited, ending at RMB 12,750/mt. Trading volumes totaled 55,832 lots, with positions down 2,110 to 160,048.

Spot aluminum largely traded between RMB 12,660-12,670/mt in Shanghai on Tuesday, discounts of RMB 20-30/mt over SHFE 1501 aluminum contract, versus RMB 12,650-12,660/mt in Wuxi and RMB 12,690-12,700/mt in Hangzhou. Aluminum prices continued to fall, enticing some processors to go bargain hunting. In the afternoon, a few transactions were reported.

Lead
Lead for March delivery on the Shanghai Futures Exchange, the most active contract, rose to RMB 12,250-12,280/mt after opening Monday’s night session at RMB 12,200/mt and ended down RMB 45/mt at RMB 12,305/mt.

On Tuesday, SHFE lead initially hovered at RMB 12,270-12,300/mt and fell by over RMB 1,000/mt afterwards before ending down RMB 180/mt at RMB 12,170/mt. Trading volumes for the SHFE 1503 lead contract totaled 12,092 lots, while positions gained 1,150 to 25,580.

Supplies from Chihong Zn & Ge and Humon in Shanghai traded Tuesday at RMB 12,510/mt, a RMB 230/mt premium to the most active SHFE 1503 lead contract, up from Monday’s RMB 150/mt premium. Shuangyan sold for RMB 12,480/mt. Smelters sold in light volumes, while traders reported low inventories, both helping push spot premiums up. The price gap between Henan and Shanghai expanded, with prices in Henan trading at RMB 12,450/mt. Downstream producers were unwilling to buy, leaving trading quiet in Shanghai.

Zinc
SHFE 1503 zinc contract prices opened at RMB 16,310/mt Monday evening, then fluctuated between RMB 16,260-16,365/mt, and closing at RMB 16,350/mt, down RMB 135/mt or 0.82%. Trading volumes were down over 20,000 to 67,484 lots, and total positions increased 3,186 to 161,870. SHFE 1503 zinc contract prices opened at RMB 16,350/mt on Tuesday, then inched down with crude oil and copper prices, dipping to as low as RMB 16,250/mt in the afternoon, and closing at RMB 16,255/mt, down RMB 230/mt or 1.4%. Trading volumes decreased 28,974 to 153,358 lots. Total positions were up 1,646 to 160,330. SHFE 1503 zinc contract prices are expected to remain weak in the near term.

#0 zinc prices were between RMB 16,570-16,650/mt, with spot premiums of RMB 220-280/mt against SHFE 1503 zinc contract prices. #1 zinc prices were RMB 16,500-16,510/mt. SHFE 1503 zinc contract prices fluctuated around RMB 16,360/mt, but spot premiums narrowed from RMB 240-280/mt to RMB 210-250/mt. Only a few smelters held back goods at lower prices, but supply was sufficient due to a large inflow of imported zinc early in the week. Cargo holders lowered spot premiums due to market pessimism and weak demand. Most downstream buyers were bearish, so were unwilling to replenish stocks. Huize #0 zinc prices were RMB 16,620-16,670/mt, RMB 270-300/mt above SHFE 1503 zinc contract prices. Shuangyan #0 zinc prices were RMB 16,600-16,650/mt, RMB 250-280/mt above SHFE 1503 zinc contract prices. Mengzi, Qilin and Qinxin zinc prices were between RMB 16,570-16,610/mt, RMB 220-240/mt above SHFE 1503 zinc contract prices. Tongguan and Tiefeng #0 zinc prices were between RMB 16,560-16,600/mt, RMB 200-230/mt above SHFE 1503 zinc contract prices. CZP and Peruvian zinc prices were between RMB 16,510-16,520/mt, RMB 150-160/mt above SHFE 1503 zinc contract prices. SHFE 1503 zinc contract prices inched down below RMB 16,300/mt in the afternoon, but spot premiums remained between RMB 220-260/mt.

Tin
In Shanghai spot tin market, inflow of cheap goods and sluggish consumption sent prices down on Tuesday. Mainstream traded prices lost RMB 500-1,000/mt to RMB 126,000-129,000/mt. Nanshan and Jinlong brand tin traded between RMB 125,900-126,500/mt, RMB 127,000-128,500/mt for Tianti, Yunxiang and Yunxi brand tin.

Nickel
SMM #1 nickel prices were between RMB 108,600-109,000/mt. LME nickel prices extended losses at the same time as spot nickel prices in Shanghai plunged, with downstream buyers purchasing modestly. Russian nickel supply was limited, but future spot was available, with trading quiet and traded prices between RMB 108,600-109,000/mt. Spot nickel prices dropped further in the afternoon, but premiums against Wuxi electronic trading rose. Traders held onto their goods on tight supply, leaving transactions quiet and traded prices between RMB 108,000-108,500/mt. Jinchuan lowered nickel price by RMB 1,500/mt to RMB 109,500/mt.