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Tags: copper prices,  aluminum prices,  lead prices,  zinc prices,  tin prices,  nickel prices

SHANGHAI, Sept. 10 (SMM)-- Copper: The night trading was suspended on Monday for the Mid-Autumn Festival. Boosted by LME copper, SHFE copper started Tuesday slightly higher at RMB 49,930/mt, but later retreated on broad sell-offs, meeting strong resistance at the RMB 50,000/mt mark. The price of the red metal extended losses to hit a low of RMB 49,300/mt during the afternoon trading session, and finished down RMB 430/mt, or 0.86%, at RMB 49,340/mt. Trading volumes for the most active contract decreased by 68,960 lots, and positions gained by 36,070 lots. Physical copper in Shanghai was quoted Tuesday at a RMB 20-200/mt premium to the SHFE 1409 copper contract. Traded prices were RMB 50,180-50,460/mt for standard-quality copper and RMB 50,280-50,600/mt for high-quality copper. As SHFE copper leveled off on Tuesday, the price gap between the SHFE 1409 and 1410 copper contracts reached around RMB 300/mt, giving cargo holders an incentive to lower premiums to boost sales. Physical premiums tracked SHFE copper down subsequently due to quiet trading, with standard-quality copper quoted at a slight premium by the midday. Middlemen were reluctant to trade early on Tuesday, but later entered the market to buy low-priced goods while building short positions. Downstream producers were largely staying out of the market, believing that physical premiums will fall further in the near term. Trading activity remained sluggish on Tuesday, the first trading day following the Mid-Autumn Festival. As SHFE copper fell further during the afternoon trading session, physical copper was quoted largely between a RMB 30/mt discount and a RMB 150/mt premium, and traded lower at RMB 50,000-50,180/mt. The price of high-quality copper held firm due to tight supply, but trading activity was light. In general, copper supply was sufficient on Tuesday, with a variety of brands available in the market. 16% of market players surveyed by SMM are optimistic that LME copper will stand above USD 7,000/mt this week, and SHFE copper will break above RMB 50,000/mt. Market participants remain confident in the US recovery despite weak non-farm payroll data released last Friday. This will allow money to continue flowing into US stock markets, pushing up stock prices. Besides, the ongoing recovery in the US will help improve base metals demand, proffering impetus for copper prices to rebound. 60% of industry insiders expect LME copper prices to remain between USD 6,920-7,000/mt this week, with SHFE copper trading at RMB 49,300-50,000/mt. LME copper prices have been hovering between short-term moving averages, and are likely to keep consolidating with the absence of any significant news. In China, although the Shanghai Composite Index closed flat Tuesday, the cross-border stock trading between mainland China and Hong Kong will be launched soon, which is expected to turn China's stock market around. Thus, the decline in copper prices will be limited. In China's physical copper market, the price gap between SHFE 1409 and 1410 copper contracts will narrow before the expiration of the former, and spot premiums are expected to hold steady, leaving SHFE copper prices stable. The remaining 29% of the surveyed are bearish, arguing that the US dollar index looks set to rise further after breaking through 84, weighing down commodity prices. Besides, the sluggishness in the euro zone will remain a drag on copper prices. The latest report from the Commodity Futures Trading Commission indicates net long positions in copper dropped to the lowest since June for the week ending September 2, while net short positions rose by 1,313 lots. On SHFE, back month copper contracts were suffering strong selling pressure, foreshadowing declines in copper prices. China's unwrought copper and copper semis imports in August remained flat with July at 340,000 mt, but were down 12.27% from a year ago. This was mainly a result of tightening control over L/C issuance and a stronger RMB, as well as weak demand in China.

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