SMM Base Metals Market Daily Review (2015-6-26)

SHANGHAI, Jun. 29 (SMM) –

Copper
SHFE 1509 copper contract prices stabilized early Friday but met strong resistance from RMB 42,000/mt. The September-delivery copper rallied in the afternoon despite an 8.5% slump in Chinese shares and touched a high of RMB 42,500/mt before ending at RMB 42,240/mt, up RMB 380/mt. Positions of the most active copper contract grew 4,618 and trading volumes were up 51,462 lots. Total SHFE copper positions declined 25,674.

SHFE reported a 12,270 mt decline in copper stocks in its approved warehouses last week to 112,921 mt

Spot copper quoted at a premium of RMB 250-290/mt over SHFE 1507 copper in Shanghai on Friday. Mainstream prices were RMB 42,400-42,500/mt for standard-quality copper and RMB 42,420-42,540/mt for high-quality copper.

SHFE copper prices rose. Markets turn anemic gradually during middle of this year and late Q2. Spot supply also fell with standard-quality copper and hydro-copper hard to source. Downstream buyers purchased on need, leaving trades light.

Aluminum
Last Friday, SHFE 1509 aluminum contract climbed to RMB 12,780/mt in the morning, but fell back to near the daily moving average in the afternoon before ending at RMB 12,760/mt. Trading volumes totaled 26,572 lots, and positions were up 2,180 lots to 110,602 lots.

Spot aluminum largely traded between RMB 12,600-12,610/mt in Shanghai last Friday, discounts of RMB 140-150/mt over SHFE 1507 aluminum contract, versus RMB 12,590-12,610/mt in Wuxi, and RMB 12,640-12,650/mt in Hangzhou. SHFE aluminum inched up, but spot prices lacked upward momentum, causing spot discounts to widen. Downstream consumption picked up slightly before the weekend. In the afternoon, market turned quiet.

Lead
SHFE 1508 lead started at RMB 13,135/mt Thursday evening session and ended down RMB 60/mt at RMB 13,105/mt with the low-end price at RMB 13,060/mt.

The contract fluctuated between RMB 13,100-13,130/mt after opening Friday trading session and dipped to RMB 13,050/mt on selling pressures. The price closed the day down RMB 65/mt at RMB 13,100/mt after rebounding thanks to support at the 5 and 20-day moving averages. Trading volumes totaled 4,758 lots with positions up 270 to 13,216.

In Shanghai’s market, trades were soft. Nangfan brand quoted RMB 13,400/mt earlier but later was offered lower at RMB 13,380/mt, RMB 260/mt higher than SHFE 1508 lead. Tongguan brand price were cut to RMB 13,370/mt from RMB 13,380/mt. Smelters held back sales whereas downstream buyers showed little buying interest due to pressures from tight liquidity and financial reports late June

Zinc
SHFE 1509 zinc contract prices opened at RMB 15,625/mt, then hovered between RMB 15,600-15,670/mt. Finally, SHFE 1509 zinc contract prices closed at RMB 15,660/mt. SHFE 1509 zinc contract prices fluctuated between RMB 15,635-15,675/mt on Friday, dipping to RMB 15,575/mt before rallying, closing at RMB 15,625/mt, down RMB 65/mt or 0.41%. Trading volumes increased 4,188 to 78,198 lots, and total positions grew 5,700 to 116,970. SHFE 1509 zinc contract prices will fall to test support from RMB 15,600/mt.

#0 zinc prices were between RMB 15,660-15,680/mt, RMB 10/mt below or RMB 10/mt above SHFE 1509 zinc contract prices. #1 zinc prices were RMB 15,620-15,630/mt. SHFE 1509 zinc contract prices fluctuated between RMB 15,650-15,670/mt, down RMB 20-30/mt, with spot premiums between RMB 0-20/mt in the morning, but narrowing to zero due to weak downstream buying interest. Traders also lacked interest in operations due to month-end settlement. SHFE 1509 zinc contract prices edged down RMB 20-30/mt in the afternoon, with spot prices RMB 0-10/mt above SHFE 1509 zinc contract prices.

Tin
In Shanghai spot tin market, mainstream traded prices fell to RMB 112,500-114,000/mt on June 26. The slump in SHFE tin prices trigged an inflow of cheap hedged goods into spot market, sending prices down. Goods from Yunnan Tin Group traded at RMB 113,5000-114,000/mt. Some downstream producers went bargain hunting.

Nickel
SMM #1 nickel prices were between RMB 92,600-94,200/mt. Premiums of Jinchuan nickel against the most actively traded contracts on the Wuxi electronic trading rose to RMB 300/mt in the morning. Trading improved recently as traders pushed sales to complete target. Downstream demand, however, remained soft, with traded prices between RMB 92,900-94,000/mt. Nickel prices continued to fall in the afternoon, with spot nickel prices hitting a near-term low. Downstream buying interest was weak, with prices between RMB 92,100-93,100/mt. Jinchuan Group lowered prices by RMB 1,000/mt to RMB 94,500/mt.