SMM Daily Review (Sept. 9)

SHANGHAI, Sept. 10 (SMM) --

    Copper:

    SHFE copper prices opened above RMB 50,500/mt. Spot-month contracts soared to RMB 50,900/mt in pre-market, and then moved below daily average line, and showed a firm performance at RMB 50,000/mt, with daily growth rate of 1.5%. The situation of strong nearby-contracts and weak forward contracts appeared in SHFE market. In spot market, spot discounts have expanded to RMB 100-200/mt after copper prices surged above RMB 50,000/mt. Discounts for most premium copper were RMB 100/mt, with traded prices in the RMB 50,300-50,450/mt range, while discounts were RMB 200/mt for parity copper. Transactions were weak when discounts for hydro-copper were RMB 250/mt, but cargo-holders were reluctant to move goods when discounts expanded to RMB 300/mt. Cargo movement of domestic copper was worse than imported copper, and copper prices above RMB 50,000/mt curbed downstream purchasing interest. Market players stood on sidelines in China when LME copper prices fell from USD 6,500/mt again.

    Aluminum:

    SHFE aluminum prices opened high but went lower, and kept moving below daily average line. Spot-month contracts prices opened at RMB 15,370/mt and closed at RMB 15,140/mt, while three-month contracts prices climbed to RMB 15,265/mt and closed at RMB 15,100/mt. In spot market, Chalco moved cargos at RMB 15,200/mt in the morning, and then offered RMB 15,180-15,200/mt. However, the weakening SHFE aluminum prices depressed traders’ sentiment, and prices for imported aluminum from Russia slid to RMB 15,000/mt first. In this context, traded prices for domestic aluminum dipped as well to RMB 15,130-15,170/mt from pre-11:00 level of RMB 15,160-15,180/mt. Producers were active in moving goods when aluminum prices remain above RMB 15,000/mt, but trading volumes failed to report increases. 

    Lead:

    In Shanghai lead market, SMM lead prices increased by RMB 300/mt to RMB 16,300-16,500/mt. A portion of famous brands lead smelters were firm with their offers at RMB 16,500/mt, but downstream consumers conducted limited purchases. Traders were in a dilemma as to whether to replenish stocks or remove existing stocks at RMB 16,500/mt. LME lead prices will be affected by environment protection inspections in China’s lead industry. Particular attention has been paid to the 12th China International Lead and Zinc Conference held in Lanzhou City.

    Zinc:

    SHFE zinc prices opened high, but kept moving below daily average line. SHFE zinc three-month contracts prices mainly moved in the RMB 15,700-15,800/mt range, and spot discounts remained at RMB 350-400/mt to three-month contracts. However, downstream purchasing interest was low, and prices offered by smelters moved around SMM #0 zinc average prices, with deals mainly among traders. Market players were cautious about the sustainability of zinc price rise, and zinc prices will face greater resistance on upward trend before the disappearance of oversupply pressure.

    Tin:

    In Shanghai tin market, Yunnan Tin Company raised tin prices to RMB 120,000/mt, but market players refused to accept it. Trading volume increased at RMB 118,000/mt, but transactions became weak when tin prices were more than RMB 119,000/mt.

    Nickel:

    In Shanghai nickel market, offers were RMB 140,000/mt for nickel from Jinchuan Group, with deals mainly made in the RMB 139,000-139,500/mt range, while offers were RMB 136,500/mt for imported nickel, but with limited cargo movement and limited inquiries. Nickel prices will remain unchanged before a clear direction shown by LME nickel prices.

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