SMM Evening Comments (Mar 25): Nonferrous metals on the SHFE fell broadly, tin dropped 2.12%

SHANGHAI, Mar 25 (SMM) – SHFE nonferrous metals fell for the most part on Thursday. Copper weakened 1.38%, zinc shed 1.49%, nickel fell 1.71%, lead declined 1.88% and tin slumped 2.12%, while aluminium closed flat.

SMM data showed that aluminium billet stocks across the five major consumption areas — Foshan, Wuxi, Huzhou, Changzhou and Nanchang — in China decreased 34,700 mt from a week ago to 198,200 mt as of Thursday March 25.

Social inventories of primary aluminium ingots across eight consumption areas in China, including SHFE warrants, decreased 7,000 mt from last Thursday to 1.24 million mt as of March 25. Stocks in Wuxi, Nanhai and Hangzhou mainly contributed to the decrease.

Copper: The most-traded SHFE 2105 copper contract fell to a two-week low of 65,480 yuan/mt before regaining some ground to finish the day 1.38% lower at 65,560 yuan/mt, with open interest adding 3,491 lots to 154,000 lots.

Aluminium: The most-active SHFE 2105 aluminium contract ended the day flat at 17,060 yuan/mt, with open interest losing 1,120 lots to 217,000 lots.

Zinc: The most-liquid SHFE 2105 zinc contract dropped 1.49% to close the day at 21,415 yuan/mt, with open interest decreasing 1,173 lots to 83,373 lots. Zinc prices declined amid global sell-off sentiment. However, domestic zinc smelters have cut output more than expectations in March-April due to restrictions on energy consumption and tight zinc concentrate supply, while downstream demand has improved, which will weigh on zinc social inventories and support zinc prices.

Nickel: The most-traded SHFE 2106 nickel contract finished the day 1.71% weaker at 119,900 yuan/mt, with open interest rising 10,314 lots to 154,000 lots.

Lead: The most-active SHFE 2105 lead contract fell 1.88% to end the day at 14,900 yuan/mt after hitting a nearly three-week high at 15,290 yuan/mt earlier in the session, with open interest adding 1,838 lots to 38,964 lots. Whether the contract could steady above 14,900 yuan/mt tonight will be monitored.

Tin: The most-liquid SHFE 2105 tin contract slumped 2.12% to close the day at 171,370 yuan/mt, with open interest rising 2,153 lots to 34,234 lots. The safe-haven greenback remained broadly stronger following a two-day rally amid worries ranging from Europe’s third COVID-19 wave and potential U.S. tax hikes to the persistent specter of inflation. The May contract may test support from the 170,000 mark tonight.