SMM Daily Review (Sept. 17)

SHANGHAI, Sept. 18 (SMM) --

    Copper:

    SHFE three-month contract copper prices opened at RMB 50,000/mt, up more than RMB 1,100/mt, but failed to break through the resistance levels and mainly moved below daily moving average line in the morning. SHFE three-month contract copper prices closed at RMB 49,650/mt, up nearly 1.6%, while spot-month contract copper prices closed at RMB 49,750/mt, up 1.5%.

    In spot market, copper prices received great pressure at RMB 50,000/mt. Spot discounts for premium copper increased from negative RMB 50/mt to negative RMB 100/mt, while discounts for parity copper also grew from negative RMB 150/mt to negative RMB 200/mt, but transactions remained scarce, with traded prices in the RMB 49,500-49,750/mt range. Market supply of imported and domestic copper remained ample despite of expanding discounts. In the mean time, market players predict copper prices will fluctuate around RMB 50,000/mt, with a sign of rise, and spot discounts will expand further.

    Aluminum:

    SHFE three-month contract aluminum prices opened at RMB 15,145/mt, but later went lower and closed at RMB 15,000/mt, remaining below daily moving average line. SHFE aluminum prices received support from RMB 15,000/mt, but were short of upward momentum. In spot market, domestic aluminum was quoted at the same price as the futures prices, with limited deals done in the RMB 15,060-15,080/mt range. CHALCO was reluctant to sell goods when aluminum prices were below RMB 15,100/mt. Although there was no signs consumers held high interest in stock replenishment, aluminum producers remained confident in price outlook after National Day holiday.

    Lead:

    In Shanghai lead market, LME lead prices advanced for two consecutive days, stabilizing the market sentiment and improving the confidence of smelters in lead prices above RMB 16,000/mt. Traders became active again and pushed traded prices up to RMB 15,900-16,000/mt. However, consumers remained cautious about lead prices above RMB 16,000/mt given sufficient inventories.

    Zinc:

    SHFE zinc prices opened high but went lower, and closed at RMB 15,345/mt, with spot-month contracts closing at RMB 15,200/mt. Total positions continued to drop, indicating long positions were not confident in the price hike, and struggles between long and short positions remained in the market. In spot market, #0 zinc was traded at RMB 15,100-15,200/mt. The weak performance of SHFE zinc prices dampened the market sentiment, but the rising LME zinc prices helped smelters remain firm. Overall transactions were weak. 

    Tin:

    LME tin prices have risen for two consecutive days, improving the purchasing interest in Shanghai tin market, so traded prices grew slightly to the range of RMB 118,000-118,500/mt, with most deals of “Yuheng” brand tin.

    Nickel:

    In Shanghai nickel market, offers were RMB 134,000/mt for Jinchuan nickel and RMB 131,000/mt for imported nickel. Downstream purchasing interest was low, but cargo-holders were reluctant to move goods in view of rising LME nickel prices, so transactions were lukewarm.

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