SMM Morning Comments (Apr 15): Shanghai base metals opened mixed Wednesday, London metals rallied after holiday

Published: Apr 15, 2020 09:56

Save

SHFE base metals traded mixed on Wednesday morning, after a broad rally on Tuesday which was prompted by lifted market sentiment following better-than-expected China March trade data.

SHANGHAI, Apr 15 (SMM) – SHFE base metals traded mixed on Wednesday morning, after a broad rally on Tuesday which was prompted by lifted market sentiment following better-than-expected China March trade data.

LME base metals went higher for the most part after trading returned from the Easter Monday holiday. Tin led the increases with a rise of 3.4%. Copper advanced 3.1%, aluminium added 2.1%, nickel climbed 1.8%, zinc gained 1.1%, while lead slipped 1.3%.

US stocks closed sharply higher and the US dollar softened on Tuesday, as risk appetite returned amid growing expectations that the worst of the COVID-19 pandemic may has passed.

Copper: Three-month LME copper increased on Tuesday as investors still concerned about the damage caused by the coronavirus outbreak on operations at global major mining areas. LME copper closed 3.11% higher on the day at $5,188.5/mt, with pressure above from $5,200/mt. Copper prices may face downward risk as prices of oil plunged on decreased demand from the pandemic, which outweighed production cuts OPEC agreed to over the weekend. LME copper is expected to trade between $5,130-5,190/mt today with the most-liquid SHFE contract at 41,400-42,000 yuan/mt. Spot premiums are seen between 80-100 yuan/mt and elevated futures may sideline consumers.

Aluminium: Three-month LME aluminium rebounded after dipped, closing up 2.09% on the day at $1,515/mt with short covering their positions. The most-traded SHFE contract has increased to a more than three-week high, with trading range expected between 11,600-11,850 yuan/mt today.

Zinc: Three-month LME zinc trimmed its increase following declines in crude oil prices, ending up 1.1% on the day at $1,930/mt. Disrupted consumption amid the COVID-19 pandemic overseas drove up LME zinc inventories. This, together with recession fears, reinforced bearish prospects for near-term zinc prices, even as governments around the world have stepped up efforts to boost consumption. LME zinc is expected to trade between $1,900-1,950/mt today with the most-active SHFE contract at 15,500-16,000 yuan/mt. Ramped-up infrastructure construction in China will bolster galvanising demand, but export orders of die casting zinc have been badly hit by the epidemic. The premiums of 0# domestic Shuangyan zinc are likely at 80-90 yuan/mt.

Nickel: Thee-month LME nickel hovered at high levels on the first trading day this week, hitting a session high of $11,900/mt and finished the day 1.75% higher at $11,905/mt. It has climbed for the fifth consecutive day with the K-indicator rising above the Bollinger middle band. Pressure above from $11,900/mt will be monitored today.

Lead: Three-month LME lead lost steam after it strengthened during the Asian trading hours with a higher SHFE lead. It came off from a session high of $1,758/mt and closed at $1,703.5/mt, 1.3% lower on the day. Pressure from the 40-day moving average may keep LME lead rangebound today.

Tin: A rallied SHFE tin lifted three-month LME tin, which hit an intraday high of $15,650/mt and retreated to end at $15,460/mt, up 3.4% on the day. LME tin inventories shank 150 mt on Tuesday to 7,095 mt. Today, LME tin is expected to test pressure from $15,800/mt.

Morning comments Futures movement Copper Aluminium Zinc Nickel Lead Tin

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or for more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

7 hours ago

Panguna Copper Mine Moves Closer to Potential Redevelopment as Lloyds Metals Receives Preparatory Works Approval

According to foreign media reports, Lloyds Metals & Energy has been authorized to undertake preparatory works and feasibility activities aimed at assessing the potential redevelopment of the Panguna copper-gold mine in Bougainville, Papua New Guinea, nearly four decades after the operation was shut down. The Autonomous Bougainville Government granted the authorization on August 7, allowing Lloyds to carry out an approved programme of preparatory and feasibility work required to assess and plan the future redevelopment of the mine. Lloyds is acting as the approved development partner of government-owned Bougainville Minerals, which holds the mining lease covering Panguna. The project represents a potentially significant source of long-term copper supply. Panguna's remaining reserves are estimated at approximately 5.3 million tonnes of copper and 19.3 million oz of gold, while Lloyds plans to revalidate the project's resource base as part of the redevelopment process. The mine has remained closed since 1989. The latest authorization follows the granting of a 25-year mining lease to Bougainville Minerals in June, providing a framework for further evaluation of the dormant asset. However, the current approval does not permit construction or copper production to begin. Any progression into those stages will require additional approvals, meaning a potential restart remains subject to further technical, regulatory and development work. The renewed progress at Panguna is notable given the scale of the historical deposit and growing efforts globally to develop additional copper supply. The immediate impact on mine supply remains limited, but successful feasibility work and resource revalidation could provide greater clarity on whether one of the world's largest dormant copper assets can eventually return to production.

7 hours ago

Bezant Resources Completes First Blast at Namibian Copper-Gold Project, Aiming for Concentrate Production

Bezant Resources PLC has completed the first blast at the Hope open pit within its 90%-owned Hope & Gorob copper-gold project in Namibia, marking a further step toward mining and future concentrate production at the project. The initial blast involved approximately 20,000 tonnes of material and is expected to liberate around 2,000 tonnes of commercially viable mineralisation. Preliminary evaluation of the exposed mineralisation indicates that its location and grade are broadly consistent with the project's existing geological block model. Following the blast, grade-control work will compare assay results from blasthole samples with the exposed mineralisation to refine ore selection. Mining and transportation of run-of-mine (ROM) ore to the Tsaoxaub Metals flotation plant are expected to begin shortly, where material will be stockpiled ahead of future plant commissioning. Preparations for further mining are also progressing. Blastholes have already been drilled for a second blast, while the mining contractor has commenced ground clearance and separation of ore and waste for haulage. Recruitment of plant operators is ongoing following the appointment of the plant site manager, while the mine geology team is working with external consultants to validate the existing block model. The first blast represents an important operational milestone as Hope & Gorob moves closer to the processing stage. The next key developments will be the delivery of ROM ore to the plant, commissioning of the flotation facility and eventual production of saleable concentrate, providing clearer indications of the project's transition from development into copper-gold production.

7 hours ago

Antofagasta Cuts 2026 Copper Output Guidance Following Los Pelambres Shutdown

According to foreign media reports, Chilean copper producer Antofagasta has lowered its 2026 copper production guidance following a weather-related shutdown at its Los Pelambres mine, reducing expected output at a time when global copper mine supply remains under pressure. Antofagasta now expects to produce 625,000–655,000 tonnes of copper in 2026, compared with its previous guidance of 650,000–700,000 tonnes. The revised range lowers the midpoint of the company's production outlook by 35,000 tonnes and reduces the upper end of its forecast by 45,000 tonnes. The downgrade follows the temporary shutdown of Los Pelambres in July after extreme rainfall affected Chile's Coquimbo Region. Although no significant damage was reported to major infrastructure, repairs are required to some pipeline platforms and water-management systems following the disruption. Despite lower production, stronger copper prices supported Antofagasta's financial performance during the first half of 2026. EBITDA increased 27% year on year to $2.84 billion, while operating cash flow rose 53% to $2.77 billion. First-half cash costs declined 8% year on year to $1.22/lb, although the company previously indicated that full-year costs are expected to increase amid persistently elevated fuel prices. From a copper-market perspective, the guidance reduction represents a further downward adjustment to expected mine supply from Chile, the world's largest copper-producing country. The disruption at Los Pelambres also highlights the continued vulnerability of near-term supply to operational and weather-related interruptions, with Antofagasta's reduced production outlook adding to existing constraints on global copper mine growth.

7 hours ago