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

SHANGHAI, Jan. 20 (SMM) – Copper Copper for March delivery on the Shanghai Futures Exchange, the most active contract, fell briefly to RMB 40,750/mt after starting at RMB 40,850/mt in last Friday’s night session. The price of the SHFE 1503 copper contract rebounded to RMB 41,630/mt afterwards and finished up RMB 520/mt, or 1.27% at RMB 41,590/mt. During the night session, positions for the most active contract shed 8,494 to 295,132, while trading volumes totaled some 250,000 lots. On Monday, SHFE copper fell to an intraday low of RMB 41,365/mt after opening a touch lower, but rebounded later to hover around RMB 41,600/mt by the midday. The price of the red metal swung by only about RMB 200/mt in the afternoon trading session and tested support at RMB 41,400/mt at the tail of the trading before ending up RMB 700/mt, or 1.70% at RMB 41,770/mt. Positions for the most active contract tumbled 16,336 to 287,290, while trading volumes shrunk by 138,000 lots. Spot copper in Shanghai was quoted Monday at a RMB 40-140/mt premium to the SHFE 1502 copper contract. Standard- and high-quality copper sold for RMB 41,800-42,020/mt and RMB 41,860-42,100/mt, respectively. As SHFE copper fluctuated narrowly, cargo holders sold at a premium seen last week in light volumes. Downstream producers stayed largely on the sideline, not expecting copper prices to rebound soon. Trading slowed sharply compared with last week, with few transactions done mostly by middlemen. Spot copper was offered at a RMB 20-120/mt premium and traded at RMB 41,800-42,000/mt in the afternoon trading. Spot premiums are not expected to stay high on Tuesday when large quantities of copper warehouse warrants will hit the market. 38% of industry insiders surveyed by SMM are optimistic about copper prices this week, noting that LME will stand above USD 5,780/mt and test USD 5,900/mt, and SHFE copper will rise to RMB 41,500-42,500/mt. Institutions now expect China’s GDP for Q4 2014 due for release Tuesday to grow 7.4% YoY. Although the CPI and PPI announced earlier turned out poor, markets believe the weak data will prompt the central government to introduce more pro-growth measures and maintain loose liquidity. In addition, the State Grid announced lately it invested RMB 338.5 billion in power grid in 2014, up 14.1% from 2013, and expected the investment to climb 24% this year to RMB 420.2 billion. The accelerating power investment is likely to buoy copper consumption. Technically, as the market has been oversold, prices tend to stage a rebound with shorts taking profit. 31% of market players remain bearish, arguing that the strong momentum of the US dollar will weigh down copper prices. Besides, more than RMB 54.1 billion flowed out of the Shanghai stock market on Monday with Chinese authorities cracking down on margin trading, and stock index futures fell by the daily limit, hurting market confidence. In China’s spot copper market, downstream buyers cut purchases at the beginning of this week, while imported copper and delivered goods continue to enter Chinese market. As such, these players hold that LME copper will fall to USD 5,560-5,680/mt and SHFE copper will drop to RMB 40,000-40,800/mt this week. Another 31% hold that copper will remain in the current trading range this week, with USD 5,700-5,780/mt for LME copper and RMB 40,800-41,800/mt for SHFE copper. Technically, copper prices are unlikely to post sharp falls following last week’s plummet. LME copper is now between the resistance at USD 5,800/mt and support at the 5-day moving average. Although crude oil prices tend to remain depressed for the long run, last Friday’s rebound allowed the oil to stabilize between the 5 and 20-day moving averages. In China, the GDP data for Q4 2014 will be the focus this week, and markets are likely to remain cautious before the release. Spot copper consumption in China will be tepid this week as downstream buyers had replenished sufficient raw materials last week. Meanwhile, cargo holders are in no rush to sell, keeping prices from falling significantly. Aluminium Last Friday night, SHFE 1503 aluminum contract climbed to RMB 12,925/mt after starting at RMB 12,840/mt, and finished the night session at RMB 12,920/mt. Trading volumes totaled 13,926 lots, with positions down 1,196 to 135,710. On Monday, the most active contract fell to RMB 12,850/mt, due to tumbling Chinese A-share and pessimism over forthcoming Chinese Q4 and 2014 GDP data. March aluminum on the SHFE ended the day at RMB 12,845/mt.
from metal.com