SMM Base Metals Market Daily Review (2015-4-21)

SHANGHAI, Apr. 22 (SMM) – 

 

Copper 

The most active SHFE copper contract moved narrowly after starting on Tuesday and fell by at the tail of trading to end down RMB 430/mt at RMB 43,370/mt. Trading volumes for the SHFE 1506 copper contract increased 3,094 lots and positions declined 18,430. Trading volumes of SHFE 1507 copper contract grew 7,468 lots, with positions up 8,210.

 

Spot copper was offered at premiums of RMB 90-150/mt to SHFE 1505 copper contract early on Tuesday, and were driven up to RMB 120-160/mt in the afternoon. Prices are RMB 43,600-43,660/mt for standard-quality copper and RMB 43,620-43,700/mt for high-quality copper.

 

Cargo holders continued to push up spot premiums. Most goods available in the market were high-quality copper, narrowing price spread between standard and high-quality copper. Transactions were few in the morning but increased near midday, with large traders entering market.

 

Aluminum      

On Monday night, SHFE 1506 aluminum contract dropped to RMB 13,065/mt after starting at RMB 13,100/mt. The most active contract ended the night session at RMB 13,075/mt. Trading volumes totaled 5,930 lots, with positions down 274 to 114,982.

 

On Tuesday, the most active contract hovered narrowly below the 5-day moving average before closing down RMB 30/mt at RMB 13,095/mt. Trading volumes totaled 14,598 lots, with positions down 2,386 to 112,870. 

 

SHFE 1505 aluminum contract continued to fall on Tuesday. Spot aluminum largely traded between RMB 12,970-12,980/mt in Shanghai, discounts of RMB 110-120/mt over SHFE 1505 aluminum contract, versus RMB 12,960-12,970/mt in Wuxi, and RMB 13,000-13,010/mt in Hangzhou. The pullback in SHFE aluminum forced sellers in spot market to cut offers. Processors still stayed out of the market. In the afternoon, trading was muted. 

 

Lead

SHFE 1506 lead, the most active contract, hit a high of RMB 13,645/mt Monday evening session and ended at RMB 13,475/mt, down RMB 80/mt.

 

The June delivery lead edged up to RMB 13,500/mt and ended at RMB 13,475/mt on Tuesday, down RMB 80/mt as some investors booked profits. Trading volumes totaled 9,088 lots and positions fell 886 to 15,672. SMM/LME lead price ratio rebounded to 6.7 due to tight supply in China’s spot lead market and growing electric vehicle battery prices.

 

In spot lead market, prices held firm. Chengyuan, Nanfang and Tongguan quoted RMB 13,600-13,630/mt, with premiums of RMB 90-110/mt. Humon offered RMB 13,590-13,600/mt. Supply remained tight, while downstream buyers were more cautious towards purchases after SHFE lead declined. Quotations in Henan, Hunan, and Jiangxi remained high, and goods in Guangdong were offered at RMB 13,320-13,450/mt. Sales of lead from Gejiu were robust. 

 

Zinc

SHFE 1506 zinc contract prices opened at RMB 16,420/mt, then touched RMB 16,530/mt, and closed the day at RMB 16,435/mt, down RMB 130/mt or 0.78%. SHFE 1506 zinc contract prices opened at RMB 16,425/mt on Tuesday, then fell to RMB 16,350/mt as a growing number of longs left the market, but rallied later on, and closed at RMB 16,420/mt, down RMB 145/mt or 0.88%. Trading volumes decreased 8,310 to 92,344 lots, and total positions decreased 11,782 to 93,174. SHFE 1506 zinc contract prices should edge down this evening.

 

#0 zinc prices were between RMB 16,300-16,350/mt, RMB 100-50/mt below SHFE 1506 zinc contract prices. #1 zinc was traded between RMB 16,230-16,260/mt. SHFE 1506 zinc contract prices dropped to RMB 16,350/mt, then edged up to RMB 16,410/mt. Smelters held back goods on falling zinc prices, but arbitrage traders sold actively, leaving supply healthy. Traders were unwilling to build stocks, and downstream buying interest also weakened, leaving overall transactions quiet. Shuangyan #0 zinc prices were RMB 16,330-16,350/mt, RMB 60-50/mt below SHFE 1506 zinc contract prices. Yuguang #0 zinc prices were RMB 16,320-16,340/mt, RMB 70/mt below SHFE 1506 zinc contract prices. Qilin #0 zinc prices were RMB 16,310-16,320/mt, with spot discounts of RMB 80-70/mt against SHFE 1506 zinc contract prices. Qinxin and Feilong #0 zinc prices were RMB 16,300-16,320/mt, with spot discounts of RMB 100-70/mt against SHFE 1506 zinc contract prices. SMC #0 zinc prices were RMB 16,280-16,320/mt, with spot discounts of RMB 100/mt against SHFE 1506 zinc contract prices. Indian #0 zinc prices were RMB 16,220-16,260/mt, with spot discounts of RMB 160/mt against SHFE 1506 zinc contract prices. SHFE 1506 zinc contract prices consolidated in the afternoon, with spot discounts stable.

 

Tin

In Shanghai spot tin market, mainstream traded prices fell to RMB 109,500-111,500/mt on Tuesday, as falling LME tin soured sentiment. Trading was thin.  

 

 Nickel   

SMM #1 nickel prices were between RMB 93,100-95,200/mt. Nickel prices remained stable. Jinchuan nickel prices were RMB 1100-1200/mt above prices on the Wuxi electronic trading. Both traders and downstream buyers were cautious, leaving trading muted and traded prices between RMB 93,400-95,000/mt. Spot nickel prices were steady in the afternoon, keeping spot premiums unchanged. Jinchuan Group ramped up supply, but purchases were muted, with traded prices between RMB 93,300-95,100/mt. Jinchuan Group raised nickel prices by RMB 700/mt to RMB 95,000/mt.