SHANGHAI, Jun. 24 (SMM) – SHFE 1508 copper contract prices opened lower at RMB 51,610/mt on the first trading day after China’s Dragon Boat Festival, and then rose before meeting resistance at RMB 42,000/mt. In the afternoon, the most active SHFE copper contract moved sideways and closed the daytime trading at RMB 41,910/mt, up RMB 10/mt. Positions declined 4,462 and trading volumes fell by 122,000 lots.
SHFE 1509 copper contract positions increased 7,302.
Spot copper quoted at premiums of RMB 240-300/mt to SHFE 1507 copper contract Tuesday. Trading prices were RMB 42,220-42,340/mt for standard-quality copper, versus RMB 42,240-42,400/mt for high-quality copper.
SHFE copper turned to rise, and cargo holders offered higher premiums in spot markets. Shortfalls in hydro-copper favored standard-quality copper prices, but most buyers did not accept the high prices, leaving trades muted.
SMM survey shows that 63% of industry insiders see copper prices to remain stable this week, with LME copper trading at USD 5,650-5,780/mt and SHFE copper at RMB 41,500-42,100/mt. Technical indicators were mixed and China’s tighter liquidity around mid-year will reduce volatility in metals markets.
23% of market players surveyed hold that LME copper will fall below USD 5,640/mt and SHFE copper will test a low of RMB 41,500/mt. The US dollar index may still rise given uncertainty over the Greek debt issue which has fueled market risk, pressuring base metals. Meanwhile, the CFTC reported short positions in COMEX copper remained high, boding ill for prices as well.
The remaining 14% of respondents expect a rebound to USD 5,800/mt for LME copper and SHFE 42,200/mt for SHFE copper, citing positive expectation for economic data due out recently and a need for a technical rebound following continuous price falls.