SHANGHAI, May 23 (SMM) –
Copper: Heightened trade tensions between China and the US continued to grow shorts in the markets and weighed on copper prices. LME copper ended 1.24% lower at $5,931.5/mt, after slid to a low of $5,913.5/mt. The most-active SHFE July contract failed to hold firm above 47,000 yuan/mt, as it fell from a high of 47,090 yuan/mt, and ended at 46,870 yuan/mt. It is expected to trade at 46,500-47,000 yuan/mt with LME copper at $5,900-5,950/mt today. Deliveries for long-term contracts may buoy spot premiums to 100-180 yuan/mt.
Aluminium: LME aluminium slipped to a low of $1,776.5/mt and ended the trading day 0.7% lower at $1,781/mt as most base metals decreased. Norsk Hydro’s Albras aluminium smelter will ramp up its output after restrictions, and this depressed confidence in longs. Today, LME aluminium is expected to trade at $1,780-1,800/mt, with the SHFE 1907 contract at 14,050-14,200 yuan/mt.
Zinc: Despite lower LME zinc inventories, LME zinc extended its downside trend as the US dollar remained at highs around 98. It dipped to the lowest overnight at $2,540/mt, and closed the trading day 1.49% lower at $2,546/mt. Limited upward momentum will keep it at $2,520-2,570/mt today. Expectations of higher supplies dragged the most-liquid SHFE July contract to a low of 20,310 yuan/mt, before it settled at 20,400 yuan/mt. It may trade weakly at 20,200-20,700 yuan/mt today.
Nickel: Pressure from fundamentals extended declines in nickel prices as LME nickel lost 0.99% to close at $11,970/mt and the SHFE 1907 contract finished 0.43% lower at 97,810 yuan/mt. We expect the weak trend to continue today with the contract hovering at 96,000-98,000 yuan/mt, and LME nickel at $11,850-12,150/mt. Spot prices are seen at 96,500-100,000 yuan/mt.
Lead: Eased pessimism around fundamentals buoyed the most-traded SHFE 1907 contract while a robust US dollar lowered other base metals. The contract rose to a high of 16,150 yuan/mt, and ended 0.28% higher at 16,120 yuan/mt. Cautious investors kept LME lead rangebound, with a low of $1,798/mt overnight. Support below is likely to underpin the SHFE 1907 contract today.
Tin: Trade fears and a higher US dollar continued to lower tin prices as LME tin decreased 0.61% to end at $19,355/mt and the most-liquid SHFE September contract closed slightly lower at 144,570 yuan/mt. Prices may consolidate at lows today with support expected at $19,100/mt for LME tin and at 144,000 yuan/mt for the SHFE 1909 contract.