SHANGHAI, May 22(SMM) – Lead inventories in China’s Guangdong began shifting towards Shanghai on widening price spread between the two markets, SMM learned.
Lead inventories in Guangdong's Nanchu Repository Management declined 1,000 tonnes May 19, which SMM believes may be a result of traders shipping goods to Shanghai lured by higher prices there.
Combined cost of warehouse entry and exit as well as waterway transport between the two regions was about 200 yuan per tonne. Meanwhile, prices of Nanfang and Chengyuan brands in Shanghai were some 400 yuan per tonne higher than those in Guangdong, leaving a decent profit for traders.
It takes about 10 days for shipping goods from Guangdong to Shanghai, meaning a number of goods will arrive in Shanghai late this month or early in June, helping ease tight supply there.
A shortage in Shanghai has sent local spot premiums up to 600 yuan to July-delivery SHFE lead May 20.
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