SMM Evening Comments (Jan 13): Shanghai nonferrous metals were mostly higher, nickel surged 3.15%

SHANGHAI, Jan 13 (SMM) – Shanghai base metals rose for the most part on Wednesday January 13. Nickel, the best performer, jumped 3.15%, copper added 0.72%, lead rose 1.72% and tin edged up 0.1%, while aluminium fell 1.11% and zinc shed 0.14%.

Planned output of construction steel rebar across China's major blast furnace steelmakers is estimated to fall 1.85% from the achieved production in December to 7.98 million mt in January, showed an SMM survey.

Copper: The most-active SHFE 2103 copper contract finished the day 0.72% higher at 58,780 yuan/mt, with open interest rising 3,873 lots to 114,000 lots.    

Third-ranking GOP Rep. Liz Cheney said she will vote to impeach President Donald Trump for his role in a mob attack on the Capitol last week. In the past week, Fed officials began to discuss the topic of reducing the central bank’s debt purchases, but Governors of the Boston Fed and the St. Louis Fed believed that it is too early to discuss debt reduction.

China’s outstanding total social financing was 284.83 trillion yuan at the end of December, and new yuan loans saw steady growth in 2020 as the country continued to keep liquidity at a reasonable and ample level amid efforts to bolster economic recovery. New yuan-denominated loans totaled 19.63 trillion yuan in 2020, up by 2.82 trillion yuan year on year, central bank data showed Tuesday. The M2, a broad measure of money supply covering cash in circulation and all deposits, increased by 10.1 percent year on year to 218.68 trillion yuan at the end of 2020. The M2 growth was 0.6 percentage points lower than that at the end of November but was 1.4 percentage points higher than the same period of the year before.

The US dollar index returned below 90, while oil prices rose sharply, which supported copper prices. 

Whether the contract could steady above 58,500 yuan/mt tonight will be monitored.

Zinc: The most-traded SHFE 2102 zinc contract closed the day 0.14% lower at 20,760 yuan/mt, after hitting a nearly two-week low at 20,625 yuan/mt earlier in the session, with open interest losing 1,653 lots to 59,069 lots. Short supply of zinc concentrate eased slightly, and zinc inventories built up amid weak consumption, which pressured zinc prices. 

Lead: The most-liquid SHFE 2103 lead contract closed 1.72% higher on the day at 14,795 yuan/mt, with open interest rising 2,288 lots to 29,333 lots. Expectations of pre-holiday stockpiling, relatively tight spot supply and stable operating rates at downstream users boosted lead prices.

Tin: The most-traded SHFE 2103 tin contract edged up 0.1% to finish the day at 153,240 yuan/mt, with open interest rising 1,013 lots to 31,848 lots. It is expected to move between 152,000-155,000 yuan/mt tonight.