SMM Evening Comments (Jan 25): Nonferrous metals on the SHFE rose broadly, tin surged 4.09%

SHANGHAI, Jan 25 (SMM) – SHFE nonferrous metals rose for the most part on Monday January 25. Copper edged up 0.07%, zinc added 0.74%, lead jumped 2.91%, nickel advanced 0.88% and tin surged 4.09%, while aluminium shed 0.17%.

Social inventories of lead ingots across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin rose 800 from last Friday January 22 to 46,1000 mt as of Monday January 25, an SMM survey showed. The stocks were down 9,600 mt from last Monday January 18.

SMM data showed that social inventories of refined zinc ingots across Shanghai, Tianjin, Guangdong, Jiangsu, Zhejiang, Shandong and Hebei increased 4,900 mt from last Friday January 22 to 146,600 mt as of Monday January 25. The stocks were up 1,900 mt from last Monday January 18.

Copper: The most-traded SHFE 2103 copper contract edged up 0.07% to finish the day at 59,090 yuan/mt, with open interest decreasing 215 lots to 123,700 lots. Open interest of the February contract lost 5,182 lots to 41,268 lots.

Faced with the threat from a new COVID-19 strain, the United States will prohibit most non-US citizens who recently visited South Africa from entering, and France may impose new lockdown measures. The British Health Minister warned that vaccines may be less effective against new virus variants. After completing compulsory testing of about 7,000 people, Hong Kong eased restrictions on uninfected residents in Kowloon. US President Biden warned citizens to prepare for the darkest days of the pandemic and announced a "wartime" pandemic prevention plan. However, Republican lawmakers insisted on opposing large-scale stimulus. But even so, the market was still optimistic about a new round of stimulus bills. Iraq will cut its oil production in the first two months of this year, and this boosted oil prices. 

Whether the copper could steady above 59,000 yuan/mt tonight will be watched.

Aluminium: The most-active SHFE 2103 aluminium contract weakened 0.17% to close the day at 14,945 yuan/mt.

Zinc: The most-liquid SHFE 2103 zinc contract ended the day 0.74% higher at 20,440 yuan/mt, with open interest losing 9,607 lots to 92,118 lots. Support below will be seen from the 20,000 yuan/mt mark.

Nickel: The most-traded SHFE 2103 nickel contract advanced 0.88% to finish the day at 135,930 yuan/mt.

Lead: The most-active SHFE 2103 lead contract jumped 2.91% to close the day at 15,555 yuan/mt after hitting a new high in 2021 at 15,635 yuan/mt earlier in the session, with open interest rising 10,511 lots to 48,026 lots. Social inventories of lead ingots across Shanghai, Guangdong, Zhejiang, Jiangsu and Tianjin rose 800 from last Friday January 22 to 46,1000 mt as of Monday January 25, an SMM survey showed.

Tin: The most-traded SHFE 2103 tin contract surged to an all-time high at 171,460 yuan/mt before paring some gains to finish the day 4.09% higher at 169,760 yuan/mt, with open interest increasing 2,821 lots to 43,677 lots. Tin ore imports from Myanmar declined recently due to Covid-induced restrictions. Shortage of raw materials prompted smelters to reduce sales, and this, combined with strong pre-holiday restocking demand, encouraged longs to add positions. It is expected to move between 162,000-175,000 yuan/mt tonight.