LIVE FUTURES REPORT 03/11: SHFE nickel prices consolidate after strong gains; copper higher on positive China data

Base metals prices on the Shanghai Futures Exchange were on divergent paths during Asian morning on Friday November 3, with nickel prices consolidating their vast gains from earlier in the week and copper prices strengthening following the release of firmer-than-expected Chinese data.

The most-traded January nickel contract on the SHFE stood at 101,220 yuan ($15,322) per tonne as of 03:03 GMT, down 230 yuan from the previous session’s close.

The contract had reached its daily upper limit on Wednesday and continued to rally to 102,650 yuan per tonne on Thursday morning, marking its highest level since June 2015.

Market participants attributed the rally to the optimism surrounding the prospect of increased demand for the metal from the electric vehicle (EV) battery sector and tight global supply of nickel full plates.

However prices may have jumped too far too soon, which is resulting in some pullback this morning, according to ANZ Research

“Nickel prices have surged 23% over the past month, as investors homed in on the potential impact of the rising demand for electric vehicles. While we agree that the potential is significant, we suspect the market has jumped the gun and a short-term pullback could be in order,” it said.

“In saying that, it will just be a consolidation as the market is likely to remain tight even before the demand growth from the EV sector kicks in. As such, nickel prices will remain on an upward trajectory, but the path won’t always be smooth,” ANZ Research concluded.

Meanwhile, better-than-expected data from China is providing some lift to copper prices this morning.

China’s October services purchasing managers’ index (PMI) exceeded market expectations with a print of 51.2, which was also well above September’s very marginal growth of 50.6. A reading above 50 indicates expansion, while below contraction.

Base metals prices
  • The SHFE December copper price increased by 290 yuan to 54,340 yuan per tonne.
  • The SHFE January aluminium price firmed by 5 yuan to 16,250 yuan per tonne.
  • The SHFE December lead price decreased by 70 yuan to 18,635 yuan per tonne.
  • The SHFE January zinc price strengthened by 85 yuan to 25,930 yuan per tonne.
  • The SHFE January tin price dipped by 20 yuan to 144,140 yuan per tonne.

Currency moves and data releases
  • The dollar index was down 0.01% to 94.69 as of 02:59 GMT.
  • In other commodities, the Brent crude oil price was down 0.13% to $60.80 per barrel, and the Texas light sweet crude oil spot price declined by 0.16% to $54.79 per barrel.
  • In US data on Thursday, unemployment claims came in at 229,000, below the forecast of 235,000. The non-farm productivity quarter-over-quarter rose 3.0%, while unit labor cost was in line with expectations at 0.5%.
  • The economic agenda is less busy today with the United Kingdom’s services PMI and US data that includes non-farm employment change, unemployment rate, trade balance, final services PMI, ISM non-manufacturing PMI and factory orders.
  • In addition, US Federal Open Market Committee member Neel Kashkari is speaking.

LME snapshot at 0302 London time
Latest 3M  LME Prices
  Price ($/t)  Change since yesterday's close ($)
Copper 6,940.5 9.5
Aluminium 2,175.5 0.5
Lead 2,463 17
Zinc 3,244 -2.5
Tin 19,505 -25
Nickel 12,710 140

SHFE snapshot at 0303 London time
Most traded SHFE contracts
  Price (yuan/t)  Change since yesterday's close (yuan)
Copper  54,340 290
Aluminium 16,250 5
Lead 18,635 -70
Zinc 25,930 85
Tin 144,140 -20
Nickel 101,220 -230

Changjiang spot snapshot on November 3
  Range (yuan/t)  Change (yuan)
Copper  54,460-54,500 140
Aluminium 15,980-16,020 80
Zinc 26,310-27,110 -30
Lead 18,600-18,800 -50
Tin  143,000-144,500 0
Nickel  101,700-101,800 600

Recent Base Metals News

Editor's pick