SMM Daily Review (Aug. 4)

SHANGHAI, Aug. 5 (SMM) --

    Copper:

    SHFE copper prices opened higher but went lower. SHFE copper spot-month contracts soared to RMB 49,000/mt, but then fall rapidly in view of shortage of upward momentum, with daily fluctuation range of RMB 500/mt, which exerted negative impact on spot copper market. Today, spot discounts were RMB 100-150/mt for high-quality copper, RMB 200-250/mt for parity copper and RMB 300/mt for hydro-copper. Only a small volume of copper from Jiangxi Copper was traded at RMB 48,000/mt, and traded prices for most spot copper were in the RMB 47,500-47,700/mt range, then fell to RMB 47,300-47,600/mt in the afternoon. Higher discounts signal the cargo-holders’ eagerness to move goods. However, the downstream consumers rejected high copper prices, leading to weak transactions. Spot copper prices met great resistance at RMB 48,000/mt.

    Aluminum:

    SHFE aluminum prices opened high, but then fell straightly to RMB 15,000/mt. In spot aluminum market, as rapid declines in SHFE aluminum prices resulted in large number of panic sell-off activities, aluminum prices fell from RMB 15,050/mt to the range of RMB 14,930-14,940/mt, and only a small volume of aluminum was traded in the RMB 14,950-14,970/mt range. Almost no price spread exists among different contracts, leaving no profit margins for arbitrageurs. In the mean time, the downstream consumers had no interest in purchases in view of falling prices, and market transactions remained weak. However, CHALCO and other large producers remained confident in aluminum prices at RMB 15,000/mt.

    Lead:

    In Shanghai lead market, SMM lead prices have risen by RMB 200/mt for two consecutive days to the range of RMB 13,900-14,100/mt, with great downward pressure from RMB 14,000/mt. The downstream consumers still had no interest in purchases. Smelters were firm with their offers, but they will lower prices to move cargos, if large demand appears. Traded prices were in the RMB 13,700-13,900/mt range.

    Zinc:

    SHFE zinc prices fluctuated in the high level and then moved downward negatively affected by falling SHFE copper prices. In spot zinc market, SMM prices were RMB 14,800-14,900/mt for #0zinc, up RMB 350/mt. However, the falling SFHE zinc prices reduced the consumers’ enthusiasm. Cargo-holders lowered prices in an attempt to collect cash. Domestic #0 zinc was traded around RMB 14,700/mt. Both LME and SHFE zinc prices moved downward, and a wait-and-see attitude dominated current market.

    Tin:

    In Shanghai tin market, smelters raised ex-works prices and offers, and SMM tin prices were in the RMB 113,500-115,500/mt range. Although downstream consumers were still reluctant to accept higher tin prices, smelters held optimistic attitude towards market outlook and kept their offers firm given rising costs.

    Nickel:

    In Shanghai nickel market, Jinchuan Group has raised nickel ex-works prices for the second time by RMB 6,000/mt to RMB 141,000/mt since August. Nickel prices were above RMB 140,000/mt in Shanghai market, Jinchuan nickel prices were RMB 145,000/mt, and imported nickel prices were RMB 142,000/mt. Cargo-holders were optimistic in the morning and inquiries from downstream consumers were up. Although LME nickel prices fell back, market confidence remained firm in Shanghai market due to positive economic news.

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