LIVE FUTURES REPORT 02/04: SHFE base metals prices higher on Chinese manufacturing data

Base metals traded on the Shanghai Futures Exchange were all higher during Asian morning trading on Monday April 2, but gains were somewhat limited in some of the metals following the release of two sets of Chinese manufacturing data showing mixed results.

The most-traded copper contract on the SHFE was at 50,210 yuan ($7,994) per tonne as of 10.56am Shanghai time, up by 30 yuan per tonne from Friday’s closing price. Around 124,000 lots of the contract have traded so far.

China’s Caixin manufacturing purchasing managers’ index (PMI) for March came in at 51 on Monday, which was below an expected print of 51.8, but still above 50. A reading above 50 indicates expansion, while below signals contraction.

“The manufacturing PMI reading in March showed that demand was not as strong as expected, leading to lower willingness of manufacturers to produce and restock. However, the ability of manufacturers to make a profit was beefed up by the stable increase in new orders and the much slower jump in input costs,” Zhengsheng Zhong, director of macroeconomic analysis at CEBM Group, said.

“The growth momentum of the Chinese manufacturing economy may have weakened in March, but at a marginal pace,” Zhong added.

But data released on March 31 showed China’s official manufacturing PMI rose to 51.1 in March, up from 50.3 a month earlier. The reading was the highest so far this year and also beat an expected print of 50.1. China’s non-manufacturing PMI for March came in at 54.6, close to the forecast of 54.5.

The official PMI is more focused on large state-owned firms, while the independently surveyed Caixin PMI is closely watched for conditions among the country’s private sector.

“One may suspect the private sector as sampled by Caixin is concerned about the possibility of Trumpian trade tariffs, and consequently more cautious than that of their state sector brethren who one may suspect are less impacted by Trump or have a large safety net,” John Browning, managing director at Bands Financial, said.

The general positivity of the readings, however, were enough to give the base metals a boost this morning.

Meanwhile, China has announced that it will implement import tariffs on 128 types of United States-origin goods from Monday. The list of new tariffs matches the list released by China on March 23.

Among these are import tariffs of 25% on aluminium scrap and 15% on seamless steel pipes.

Rest of complex higher

  • The SHFE May zinc contract rose 25 yuan to 24,970 yuan per tonne.
  • The SHFE May lead contract increased 30 yuan to 18,855 yuan per tonne.
  • The SHFE May tin contract gained 580 yuan to 145,260 yuan per tonne.
  • The SHFE May aluminium contract was up by 100 yuan to 13,870 yuan per tonne.
  • The SHFE July nickel contract rose 600 yuan to 100,400 yuan per tonne.

Currency moves and data releases

  • The dollar index was down by 0.13% to 89.96 as of 11.03am Shanghai time.
  • The Brent crude oil spot price rose by 0.53% to 69.70 as of 11.04am Shanghai time.
  • In equities, the Shanghai Composite was up by 0.38% to 3,181.07 as of 11.03am Shanghai time.
  • Major data releases scheduled for later today include final manufacturing PMI, ISM manufacturing PMI, construction spending and ISM manufacturing prices from the US.
  • The London Metal Exchange is closed today for Easter Monday bank holiday.

SHFE snapshot at 10.56am Shanghai time
Most-traded SHFE contracts
  Price (yuan per tonne) Change since previous session’s close (yuan)
Copper (May) 50,210 30
Aluminium (May) 13,870 100
Zinc (May) 24,970 25
Lead (May) 18,855 30
Tin  (May) 145,260 580
Nickel  (July) 100,400 600

Changjiang spot snapshot on April 2
  Range (yuan per tonne) Change (yuan)
Copper  50,100-50,120 330
Aluminium 13,710-13,750 90
Zinc 24,910-24,960 170
Lead 18,900-19,100 200
Tin  144,000-145,500 2,000
Nickel  99,800-100,300 1,400
What to read next
Fastmarkets has corrected the pricing rationale for MB-AL-0302 aluminium 6063 extrusion billet premium, ddp North Germany (Ruhr region), $/tonne, which was published incorrectly on Friday April 19. No prices were corrected.
The low-carbon aluminium differential in the US made its first move on Friday April 5 since Fastmarkets launched it five months ago.
Brazil's aluminium industry is further enhancing its sustainability by boosting renewable energy use and recycling, while mitigating risk from high-carbon imports
German copper producer Aurubis is among the least likely to consider reducing capacity despite record low treatment charges (TCs), according to its chief executive officer
European copper demand, particularly for wire rod, remains strong and seems to be outpacing broader macro-economic growth in the region, the chief executive officer of German producer Aurubis has said.
The process to place the smaller and less efficient of the two processing plants at Los Bronces on care and maintenance is expected to be completed by mid-2024 and comes as the company pushes value over volume, the chief executive officer of Anglo American Chile said