LIVE FUTURES REPORT 11/06: Copper leads SHFE base metals prices upward

Base metals prices on the Shanghai Futures Exchange were up across the board during Asian morning trading on Monday June 11, with copper leading the advance following the release of healthy Chinese economic data over the weekend.

The most-traded August copper contract price on the SHFE rose to 54,260 yuan ($8,472) per tonne as at 9.50am Shanghai time, up 480 yuan per tonne from Friday’s closing price.

“China’s economic data for last month released on Saturday was in line or better than expected, which supports a bullish outlook for the red metal from a macroeconomic perspective,” Xianfei Ji, analyst at Guotai Junan Futures, said.

In data released over the weekend, China’s consumer inflation (CPI) rose by 1.8% year on year in May, which was in line with market expectations. Meanwhile, the country’s producer price index (PPI) rose by 4.1% in May from a year earlier, bolstered by a recent jump in commodity prices, according to China’s National Bureau of Statistics.

“The ongoing environmental inspection [across China] will also support copper prices by reducing supply, so we expect more upside for copper futures prices with a temporary limit of 55,000 yuan per tonne,” Ji added.

Though China domestic copper cathode output increased year on year in May, the market is seeing stronger demand for the material, which supports analysts’ bullish sentiment for the red metal.

“From a demand perspective, tenders for the first batch of [electric vehicle] charging stations increased by 204% on a yearly basis, which was much better than expected and anticipated to promote the high growth of the charging pile industry and become a new demand engine for copper demand this year,” Citic Futures Research said.

In supply news, BHP will respond to a counter-proposal by the workers’ union at its Escondida copper mine in Chile on Monday, the Escondida No 1 union said on its website, which could advance progress in the ongoing dispute between the two parties amid rallying copper prices.

Citic Futures Research expects a higher probability of an agreement being reached rather than a strike taking place, given the current elevated copper prices.

Base metals prices

  • The SHFE September nickel contract price jumped by 1,110 yuan per tonne to 116,010 yuan per tonne.
  • The SHFE August aluminium contract price edged up by 5 yuan per tonne to 14,915 yuan per tonne.
  • The SHFE August zinc contract price rose 150 yuan per tonne to 24,410 yuan per tonne.
  • The SHFE September tin contract price increased 240 yuan per tonne to 152,290 yuan per tonne.
  • The SHFE July lead contract price climbed 120 yuan per tonne to 20,505 yuan per tonne.

Currency moves and data releases
  • The dollar index was down by 0.09% at 93.47 as at 11.21am Shanghai time.
  • In other commodities, the Brent crude oil spot price was up by 0.15% to $ 76.49 per barrel as at 11.21am Shanghai time.
  • In equities, the Shanghai Composite was down by 0.20% to 3,061.37 as at 11.22am Shanghai time.
  • The economic agenda is light today with UK data including manufacturing production, goods trade balance, construction output and industrial production of note.

LME snapshot at 2.48am London time
Latest three-month LME Prices
  Price
($ per tonne)
 Change since Friday's close ($)
Copper 7,296 -12
Aluminium 2,305 -2
Lead 2,482 15
Zinc 3,192 -11
Tin 21,085 -85
Nickel 15,465 15

SHFE snapshot at 9.50am Shanghai time
Most-traded SHFE contracts
  Price
(yuan per tonne)
 Change since Friday's close (yuan)
Copper (August) 54,260 480
Aluminium (August)
14,915 5
Zinc (August)
24,410 150
Lead (July)
20,505 120
Tin  (September)
152,290 240
Nickel (September)
116,010 1,110

Changjiang spot snapshot on June 11
  Range
(yuan per tonne)
 Change
(yuan)
Copper  53,840—53,860 410
Aluminium 14,710—14,750 -20
Zinc 24,810—25,810 250
Lead 20,700—20,900 150
Tin  149,500—151,500 0
Nickel  116,850—116,950 550

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