SMM Copper Market Daily Review (2015-9-11)

SHANGHAI, Sept. 14 (SMM) – LME copper grew above the 60-day moving average overnight but SHFE copper was slow to rise. SHFE 1511 copper started slightly lower at RMB 40,990/mt during Thursday evening session but then drifted higher to RMB 41,280/mt in response to LME copper and crude oil prices. The contract finally ended the session at RMB 41,030/mt, up RMB 80/mt. Positions declined 3,288 to 227,552 with trading volumes around 270,000 lots.

SHFE copper mainly moved around RMB 41,130/mt on Friday and finally closed the day RMB 240/mt higher at RMB 41,160/mt, gaining 0.51%. Trading volumes decreased 90,000 lots with positions down 9,450 to 221,390.

In Shanghai market, spot copper discounts narrowed to RMB 0-50/mt against SHFE front-month contract on Friday. Traded prices were RMB 41,120-41,180/mt for standard-quality copper and RMB 41,140-41,200/mt for high-quality copper.

SHFE copper headed for stability last Friday. Huge amounts of traders sourced goods for term contracts in the morning and then downstream buyers also entered market. Standard-quality copper was most favored by buyers and hence large purchase tightened supply and narrowed spot discounts of standard-quality copper. This also left no price gap between standard and high-quality copper. But spot discounts on hydro-copper only narrowed slightly. Trading activity was thus very active.

SHFE lead once trended higher to RMB 13,465/mt after opening Thursday evening session at RMB 13,410/mt. But later SHFE lead fell back slightly with longs exiting market before finishing at RMB 13,395/mt, rising RMB 40/mt.