SMM Base Metals Market Daily Review (2015-5-12)

SHANGHAI, May 13 (SMM) – 

 

Copper 

SHFE 1507 copper contract prices moved around RMB 45,700/mt Tuesday morning, but began rising in the afternoon to touch RMB 45,930/mt. The prices closed at RMB 45,830/mt, up RMB 50/mt. Trading volumes declined 85,276 lots, and positions dropped 4,022.

 

Spot copper quoted between a RMB 20/mt discount and a premium of RMB 90/mt to SHFE 1505 copper contract in Shanghai early May 12. Standard-quality copper traded at RMB 45,800-45,860/mt, and high-quality copper sold for RMB 45,820-45,920/mt.

 

Some speculators sourced goods in the market and some traders also purchased goods to deliver term contracts, helping lift spot premiums. Downstream buyers purchased at lows, enlivening spot trading. Traded prices were RMB 45,830-45,970/mt in the afternoon. 

 

Aluminum      

On Tuesday, SHFE 1507 aluminum contract drifted lower after opening at RMB 13,450/mt. The contract closed at an intraday low of RMB 13,315/mt. Trading volumes totaled 3,918 lots, and positions were down 2,712 to 131,570. Prices might test support at the 20-day moving average since technical side is negative.  

 

Spot aluminum in east China followed SHFE 1505 aluminum contract down on Tuesday. Mainstream traded prices were RMB 13,040-13,060/mt in Shanghai, discounts of RMB 150-170/mt over SHFE 1505 aluminum contract, versus RMB 13,020-13,050/mt in Wuxi, and RMB 13,060-13,070/mt in Hangzhou. Lower prices lured buyers in. In the afternoon, buying cooled due to uncertainty over future price movement. 

 

 Lead

The most-traded SHFE 1507 lead dived to RMB 13,360/mt after opening Monday’s evening session at RMB 13,450/mt. The contract ended down RMB 110/mt at RMB 13,395/mt. SHFE 1507 lead dipped to RMB 13,295/mt Tuesday and finished the day at RMB 13,320/mt, down RMB 185/mt or 1.37%. Total trading volumes were up 1,246 to 7,050 lots while positions were down 134 to 15,628.

 

In spot lead market, Chengyuan and Tongguan quoted RMB 13,680-13,700, RMB 330-350/mt higher than SHFE 1507 lead contract price. Shuangyan (packed in iron) brand was offered at RMB 13,600/mt. Only Tongguan sold in limited amount and some hedged goods traded in the market. Most traders increased purchase but rarely sold due to limited stocks. Downstream producers remained bearish in response to falling SHFE 1507 lead. Goods in Henan traded at RMB 13,625-13,700/mt. Lead smelters in Hunan and Jiangxi mainly sold under term contract. 

 

 Zinc

SHFE 1507 zinc contract prices opened at RMB 17,000/mt Monday evening, then slipped to as low as RMB 16,875/mt, and closed at RMB 16,885/mt, down RMB 150/mt or 0.88%. SHFE 1507 zinc contract prices opened at RMB 16,895/mt on Tuesday, then dipped to as low as RMB 16,820/mt, and closed at RMB 16,870/mt, down RMB 165/mt or 0.97%. Trading volumes increased 1,220 to 162,110 lots, and total positions fell 13,572 to 137,510. SHFE 1507 zinc contract prices are expected to fall to test the 20-day moving average this evening.

 

#0 zinc prices were between RMB 16,730-16,780/mt, RMB 120-90/mt below SHFE 1507 zinc contract prices. #1 zinc was traded between RMB 16,710-16,720/mt, with spot discounts narrowing to RMB 150/mt against SHFE 1507 zinc contract prices. SHFE 1507 zinc contract prices fell to RMB 16,850-16,870/mt after opening, with spot discounts of #0 zinc contracting to RMB 120-90/mt against SHFE 1507 zinc contract prices. Traders sold actively on narrowing spot discounts, and some of them purchased at lower prices, with overall transactions brisk. Downstream buyers purchased as needed, with overall transactions improving. Shuangyan and Huize #0 zinc prices were RMB 16,750-16,780/mt, RMB 100-90/mt below SHFE 1507 zinc contract prices. Yuguang #0 zinc prices were RMB 16,740-16,770/mt, RMB 110-100/mt below SHFE 1507 zinc contract prices. Qilin, Jiulong and Qinxin #0 zinc prices were RMB 16,730-16,750/mt, with spot discounts of RMB 120-110/mt against SHFE 1507 zinc contract prices. Baohui, Bailing and SMC #0 zinc prices were RMB 16,700-16,720/mt, with spot discounts of RMB 150-140/mt against SHFE 1507 zinc contract prices. Indian #0 zinc prices were RMB 16,690-16,710/mt, with spot discounts of RMB 160-150/mt against SHFE 1507 zinc contract prices. SHFE 1507 zinc contract prices remained steady in the afternoon, with spot prices also unchanged. 

 

  Tin

Falling LME and SHFE tin dampened sentiment in Shanghai spot tin market, sending prices down. Most deals closed between RMB 119,200-121,000/mt on Tuesday. Goods from Yunnan Tin Group traded between RMB 120,500-121,000/mt. 

  

 Nickel   

SMM #1 nickel prices were between RMB 104,000-109,100/mt. Nickel futures prices fell in the morning. Premiums of Jinchuan nickel remained at RMB 4,200/mt against prices for the most actively traded contracts on the Wuxi electronic trading. Jinchuan sold deliverable spot goods at a price RMB 1,500/mt above market prices. Downstream buying interest was weak, with traded prices between RMB 104,300-109,100/mt. Nickel futures prices dropped in the afternoon, weighing on spot nickel prices. SMM understands a few traders have warrants of Jinchuan nickel. This will help alleviate market corner. Downstream buying interest remained weak, with traded prices between RMB 103,700-108,500/mt.