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SMM Base Metals Market Daily Review (2015-8-6)
Aug 7, 2015 10:03CST
SHFE 1510 copper contract started at RMB 38,170/mt for Wednesday night, and fell to RMB 37,830/mt before ending at RMB 37,930/mt, down by RMB 200/mt.

SHANGHAI, Aug. 7 (SMM) – 


SHFE 1510 copper contract started at RMB 38,170/mt for Wednesday night, and fell to RMB 37,830/mt before ending at RMB 37,930/mt, down by RMB 200/mt.

Along with Chinese stock rallies, market sentiment improved slightly on Thursday. SHFE copper rebounded from low to regain early losses and rose to RMB 38,200/mt. In the afternoon, the red metal fell back and closed at RMB 38,050/mt, down by RMB 80/mt or 0.21%. Trading volumes slipped 7,716 lots while positions upped 1,558.

Spot copper was offered at discounts of RMB 20-50/mt to SHFE 1508 copper contract in Shanghai market, with traded prices at RMB 38,500-38,580/mt for standard-quality copper and RMB 38,540-38,640/mt for high-quality copper.

Some speculators sourced high-quality copper early morning allowing spot copper to turn to premiums from discounts. But spot premiums started to slip as trades were curbed by the SHFE copper price rally early Thursday. Hydro-copper prices stayed low while supply of imported copper decreased modestly as cargo holders sold at lows. Trading activities declined further in the afternoon.  


SHFE 1510 aluminum opened at RMB 12,075/mt on Thursday, and moved between RMB 12,040-12,080/mt in morning trade. However, the light metal fell sharply in afternoon trade due to massive entry of shorts, and ended down RMB 85/mt at RMB 12,025/mt. Trading volumes were up 7,576 lots to 25,772 lots, and positions were up 2,942 lots to 149,000 lots. Smelter production cuts are not enough to offset growing new capacity and falling consumption, leaving the market depressed. So, SHFE 1510 aluminum remains vulnerable at RMB 12,000/mt.

Aluminum prices were mainly between RMB 11,940-11,960/mt in Shanghai on Thursday, discounts of RMB 10-30/mt over August aluminum on the SHFE, versus RMB 11,920-11,940/mt in Wuxi and RMB 11,940-11,960/mt in Hangzhou. Sellers and buyers couldn’t agree over prices, leaving trading subdued. In the afternoon, market turned quiet.  


SHFE 1510 lead closed at RMB 12,860/mt for night trading Wednesday, down by RMB 70/mt. 

SHFE lead followed China’s A-shares up to RMB 12,920/mt during day trading Thursday. China’s A-shares started to fall in the afternoon and thus base metals were weighed, mirroring that base metals turned more sensitive to Chinese stocks with stronger dollar. The contract finally closed at RMB 12,910/mt, falling RMB 20/mt. Trading volumes were 2,720 lots and positions rose 168 to 17,974.

Nanfang brand was offered RMB 320/mt higher than SHFE 1510 lead at RMB 13,200/mt in Shanghai market, versus RMB 13,180/mt for Humon brand, RMB 13,140-13,160/mt for YT and Jinyuteng brands and RMB 13,030/mt for Shuangyan brand (packed in iron).

Only Shandong Humon Smelting shipped goods out Thursday with shortfalls in the rest brand lead. Some large producers purchased as usual and the reaming downstream buyers showed little buying interest as high temperatures impacted production at those producers and as widening spot discounts in Henan attracted more buyers.


SHFE 1510 zinc contract prices opened low at RMB 14,680/mt Wednesday evening, then hovered between RMB 14,580-14,630/mt, and closed at RMB 14,600/mt, down RMB 135/mt or 0.92%. SHFE 1510 zinc contract prices surged to RMB 14,710/mt then fell on Thursday, and closed at RMB 14,625/mt, down RMB 110/mt or 0.75%. Trading volumes increased 4,386 to 109,062 lots, and total positions increased 7,770 to 162,868. SHFE 1509 zinc contract prices are expected to find support from RMB 14,600/mt.

#0 zinc prices were between RMB 14,930-14,980/mt, RMB 280-300/mt above SHFE 1510 zinc contract prices on Thursday. #1 zinc prices were RMB 14,880-14,900/mt. Spot premiums of imported zinc were RMB 220-240/mt against SHFE 1510 zinc contract prices. SHFE 1510 zinc contract prices opened at RMB 14,620/mt after opening, then edged up to RMB 14,710/mt. Smelters held back goods, leading to supply tightness of registered #0 zinc. Traders kept quotes firm. Supply of imported zinc increased, with trading mainly done for the first. Downstream buyers purchased as needed. Spot premiums grew in the afternoon as traders lifted prices on tight supply, with price for domestic registered brands between RMB 14,930-14,990/mt and trading muted.


In Shanghai spot tin market, trading was poor. Mainstream traded prices followed SHFE tin down to RMB 108,200-110,000/mt on August 6. Goods from Yunnan Tin Group traded at RMB 109,000-109,800/mt.


SMM #1 nickel prices were between RMB 80,300-81,300/mt. Premiums of Jinchuan nickel against the most actively traded contracts on the Wuxi electronic trading were RMB 100/mt in the morning. Jinchuan Group raised ex-works prices slightly in the morning, and sold proactively, with the price spread between Jinchuan and Russian nickel narrowing to RMB 400/mt. Trading remained quiet, with traded prices between RMB 80,400-81,000/mt. Nickel prices fluctuated in a wide range in the afternoon, with premiums of Jinchuan nickel against the most actively traded contracts on the Wuxi electronic trading RMB 100/mt in the morning. Jinchuan Group adjusted ex-works price due to the large inflow of imported zinc. Domestic stainless steel plants cut output in August, weakening demand for nickel, with trading quiet and traded prices between RMB 80,500-81,000/mt. Jinchuan Group hiked price by RMB 500/mt to RMB 81,200/mt.

SHFE copper prices
SHFE aluminum prices
SHFE lead prices
SHFE zinc prices
Shanghai tin prices
Shanghai nickel prices

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