SMM Daily Review - 2009/12/31 Copper Market

SHANGHAI, Jan. 4 (SMM) -- SHFE copper market advanced after opening higher on Thursday, with prices rising above RMB 59,000/mt. Although trading sentiment waned from a day earlier, positions reported slight increases in the morning trade session, and with total positions near 150,000 lots, despite of declines of 1,242 lots in the afternoon business. SHFE 1004 hit a yearly new high of RMB 60,000/mt in the afternoon session after failing to rise above the price level in the morning, with prices ending up 2.13% at RMB 60,020/mt. SHFE current month copper contract prices failed to break through RMB 59,600/mt, with prices closing at RMB 59,560/mt following withdrawal of large long positions in the afternoon.

In the spot market, most middlemen and traders stood on the sidelines, since bank settlement on Thursday was closed at 1:30 pm, showing low interest in making deals. A small number of copper consumers made inquiries all around, and cargo-holders with selling interest maintained offers firm as a result. Spot discounts remained in the negative RMB 200-300/mt, and deals were made at RMB 59,000/mt, with the high-end reported at RMB 59,200/mt. Market players are optimistic towards copper prices in 2010, believing spot copper prices will hit RMB 60,000/mt. According to SMM data, the average spot copper price was RMB 42,378/mt in 2009.

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