SMM Daily Review (Sept. 16)

SHANGHAI, Sept. 17 (SMM) --

    Copper:

    SHFE copper prices opened high, and inched down and fluctuated around RMB 49,000/mt after soaring to RMB 49,150/mt in the morning. SHFE three-month contract copper prices felt greater pressure at RMB 49,000/mt. In spot market, discounts appeared again, with RMB 50-100/mt for parity copper and RMB 50-0/mt for premium copper, leaving a price spread of only RMB 50/mt between parity copper and premium copper. Transactions of parity copper faced great difficulties today, and especially when spot premiums for premium copper grew to RMB 20-30/mt in the afternoon, spot discounts for parity copper also rose to RMB 50/mt, transactions became even worse. Spot discounts for hydro-copper were RMB 120-150/mt, but the purchasing interest remained low, and only transactions of premium copper were moderate. Trading volumes reported significant declines when copper prices moved up to RMB 49,000/mt, and complete discounts will appear in the market, if SHFE copper prices continue to advance.

    Aluminum:

    SHFE aluminum prices opened high and kept moving at high levels, finding greater resistance from RMB 15,000/mt. In spot market, premiums dropped along with rising SHFE aluminum prices, and aluminum with “Qingtongxia” and “Haihu” brand was sold at RMB 15,000/mt. Imported aluminum was unavailable for two consecutive days. In this context, offers for inferior brand aluminum grew as well following registered brand given shortages of low-priced imported aluminum. However, consumers became more cautious when aluminum prices advanced to RMB 15,000/mt.

    Lead:

    LME lead prices outperformed lead prices in Shanghai market, but SMM lead prices still grew by RMB 100/mt to RMB 15,600-15,800/mt. Smelters were reluctant to sell and held confidence in RMB 16,000/mt. Traders faced difficult in the availability of low-priced lead from lead smelters. Market traded prices advanced to RMB 16,500/mt, and the transactions reported no improvement. Downstream consumers adopted a cautious attitude.

    Zinc:

    SHFE zinc prices opened high and went lower. SHFE zinc prices moved below daily moving average line in the morning, but climbed in the afternoon propelled by rising LME zinc prices, with spot-month contracts stabilizing at RMB 15,000/mt and three-month contracts remaining at RMB 15,200/mt. In spot market, discounts of RMB 300/mt appeared again, with traded prices for #0 zinc moving in the RMB 14,850-14,900/mt range. Zinc prices faced greater resistance from RMB 15,000/mt. LME zinc prices broke through USD 1,900/mt, and SHFE zinc prices followed the uptrend, but spot zinc prices will remain weak.

    Tin:

    In Shanghai tin market, tin prices moved in the RMB 117,500-118,000/mt range mildly, as it is not the proper time for domestic smelters to raise tin prices. 

    Nickel:

    In Shanghai nickel market, Jinchuan Group reduced nickel ex-works prices by RMB 3,000/mt to RMB 133,000/mt again, but this move failed to exert impact on the market. On the contrary, domestic nickel prices recovered following the upward trend of LME nickel prices, with imported nickel prices up to RMB 130,000/mt and prices for Jinchuan nickel moving around RMB 133,000/mt. Consumers remained cautious, and only limited traders purchased when prices were low, leaving slim trading activity.

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