Cu-Premium remains high, import profit narrows

Date Sep 21 2018 14:17:37Source:SHMET

Premiums for CIF in Shanghai came to $115-$125/mt, and that for Shanghai bonded warehouse was at $115-$130/mt. SHFE Spot/LME 3M arb was at 8.14, whilst 3M SHFE/3M LME arb came to 8.03. LME C-3m valued was $7C, with a spot import gain of around RMB188/mt and a loss in forward market of about RMB769/mt.


Foreign trade spot market keeps going up, while import profit and loss has narrowed significantly. It seems domestic resources are ample, which indicating that traders are lucrative from import.

Edited by SHMET

【Cu Morning】LME copper moves up over significant oscillation of US dollars

Date Sep 21 2018 09:35:06Source:SHMET

LME copper opened at $6094.5 mt on the previous trading day. The market sentiment cooled down in the morning, but recovered after London trading session started. LME copper peaked at $6124/mt, bottomed at $6045.5/mt and closed at $6115/mt.


SHFE copper main contracts (1811) opened at49330 yuan/t on the previous trading day. At last, it peaked at 49500 yuan/t, bottomed at 491110 yuan/t and closed at 49480 yuan/t.


China banking exchange settlement and sale deficit in August was 63.3 billion yuan, recoding the largest of recent over one year. It means enterprises’ forward settlement ability strengthens after the continuous depreciation of exchange rate.  

Edited by SHMET

【Al Morning】The US dollar fell to the 2-month low and SHFE aluminum continued to rebound

Date Sep 21 2018 09:25:46Source:SHMET

The dollar plunged to a more than 2-month low against a basket of currencies yesterday. LME aluminum opened slightly higher above 2030 USD/ton and surged during European trading hours with heavy turnover. It reached the highest level of 2061 USD/ton and closed at 2056.5 USD/ton, up 26.5 USD or 1.31% from yesterday.


SHFE main 1811 contract surged to 14625 yuan/ton at night opening and consolidated in a narrow band. It closed at 14650 yuan/ton, up 0.76%, with a turnover of 83062 lots. Positions decreased 804--262266 lots. After falling to a new month low level, SHFE aluminum reconsolidated recently and the daily K line has been Young for three consecutive days. Given the “Golden September and Silver October” as well as cost-end supports, SHFE aluminum will extend the pattern of rebound in the short term.

Edited by SHMET

【Pb and Zn Daily】Lead demand is better and spot zinc price gain is not as good as futures

Date Sep 20 2018 17:33:07Source:SHMET

Spot market

Lead: Shanghai spot lead mainstream offer is at RMB19220-RMB19320/ton, up 245 yuan / ton from the previous trading day, which has a premium 350 - 400 yuan / ton compared with 1810 contract. Shanghai Nanfang, Mengzi and Shuangyan brand quotations have a premium of 350 - 450 yuan/ton compared with 1810 contract, and Mengzi and Shuangyan brand quotation has a premium of 400 yuan / ton compared with 1810 contract. Some refineries quotation in Henan also rose slightly. Most of the smelting enterprises are long orders, and the single orders can be sold, and the refinery stocks are low. Lead demand is better, and some refineries are even in short supply.


Zinc: Shanghai spot zinc price of 0# zinc is at RMB22210-RMB22310/tonne, up RMB440/ton from the previous trading day, which is 300B to 400B compared with SHFE zinc 1810 contract. The price of 1# zinc is at RMB22150-22250/ton, up RMB440/ton from the previous trading day, having a premium of RMB240-RMB340/ton compared with SHFE zinc dominant 1810 contract. Today's zinc continued to open sharply higher. The initial offer of cargo holders was roughly the same as yesterday. The zinc price continued to rise. The downstream purchase intention was not high, the market turnover was blocked, and the quotation premium was lowered. During the second trading session, zinc continued to rise, and the price of the cargo holders continued to decline. However, the downstream purchasing mentality remained cautious and the market transactions were relatively general.


SHMET comments:

Today, the most traded 1811 contract of Shanghai lead rose 1.15%. The battery companies actively purchase for storage. Both primary lead and regenerated lead are selling optimistically. From the perspective of technology, the support of LME-lead and SHFE-lead is solid, and the most traded contract of shanghai-lead runs relatively high. It is expected that the lead price will continue to fluctuate violently, which is a high probability event.


Zinc prices extended yesterday's rise, with the spot price up 900 yuan/ton within two days, while imported zinc rose 880 yuan/ton. It is close to Mid Autumn festival, the downstream has a certain demand for replenishment, but the high volume of spot premium makes the market transaction blocked. Today's spot premium has been significantly lower than yesterday. In the future, attention should be paid to the change of foreign trade premium and the stock situation in the spot market.

Edited by SHMET

【Al Daily】Cargo holders quoted firm and SHFE aluminum may recover in the weak pattern

Date Sep 20 2018 17:29:53Source:SHMET

Spot Market

Shanghai spot aluminum ingot is quoted at 14530-14570 yuan/ton, up 80 yuan/ton, with contango 20 yuan/ton to backwardation 20 yuan/ton against 1810 contract. Today’s quotation from cargo holders was firm and aluminum ingots spot price moved up following futures. The middlemen were active to trade and the downstream purchased on demand. The overall market transaction performance was slightly better.


Comments from SHMET

LME aluminum fell after rising during Asian trading hours today. SHFE main 1811 contract modestly moved up within the day and rose 0.52%. The daily K line has been Yang for 3 consecutive days. Overall, after touching the one-month low 14400 yuan/ton, SHFE aluminum stabilized in recent days. With a slight rebound, SHFE aluminum may extend the pattern of weak recovery. Even though spot market has ample supply at present, “Golden September and Silver October” may stimulate market stock demand. Meanwhile, downstream cost-end alumina price still hold high, providing support for futures and spot prices.

Edited by SHMET