LIVE FUTURES REPORT 15/12: SHFE copper leads the pack higher; lead, tin prices dip

Copper prices on the Shanghai Futures Exchange outperformed the rest of the base metals complex during Asian morning trading on Friday December 15, with the red metal continuing to find support from expectations of supply disruptions and tightened supply.

The most-traded February copper contract on the SHFE stood at 52,650 yuan ($7,963) per tonne as of 10.40am Shanghai time, up by 0.7% or 360 yuan from the previous session’s close.

“Investors were also induced to cover some bearish trades as the outlook for further supply disruptions darkened. With prices pushing higher, the likelihood of strike action in Chile is increasing. Next year, nearly three quarters of the country’s supply is susceptible to strike action as wage contracts expire,” ANZ Research noted.

Workers at Teck Resources Ltd’s Quebrada Blanca copper mine in Chile are preparing to go on strike after their contract expired at the end of November and negotiations failed to produce a deal. But the company maintains that operations will continue and that any labor action will not impact overall production.

Aluminium was hot on the heels of copper this morning with the light metal pushing up by 0.6% on the back of supportive data out from China, which showed the country’s aluminium production had fallen for a fifth consecutive month in November.

“Aluminium benefited from data showing lower output from China. Investors had been concerned recently that the curbs on aluminium output wouldn’t be as severe as first expected. However, data released yesterday showed that isn’t the case. Production for November slumped to 2.35 million tonnes, which was down 7.7% from October and the lowest absolute level since February this year,” ANZ Research said on Friday.

Lead, tin dip; rest higher

  • The SHFE February aluminium contract price rose by 85 yuan to 14,360 yuan per tonne.
  • The SHFE February zinc contract price gained 145 yuan to 25,250 yuan per tonne.
  • The SHFE May nickel contract price was 500 yuan higher at 89,710 yuan per tonne.
  • The SHFE January lead contract price was down by 70 yuan to 18,980 yuan per tonne.
  • The SHFE January tin contract price dropped by 190 yuan to 134,410 yuan per tonne.

Currency moves and data releases

  • The dollar index was down by 0.09% at 93.55 as of 11.19am Shanghai time.
  • In other commodities, the Brent crude oil spot price was down by 0.06% to $63.30 per barrel, while the Texas light sweet crude oil spot price increased by 0.12% to $57.14 per barrel.
  • In equities, the Shanghai Composite was down 0.67% to 3,270.23.
  • In data on Thursday, China’s industrial production rose by 6.1% year on year in November, following a 6.2% gain in the prior month while markets expected 6.2%. Meanwhile, retail sales increase by 10.2% from a year earlier in November, after a 10% rise in the previous month, but this was below market expectations of a 10.3% increase.
  • In US data, the flash services and manufacturing purchasing managers’ indices (PMI) came in at 55.0 and 52.4 respectively, with the latter significantly lower than an expected print of 54.8. Business inventories were in line with expectations at 0.1%, while unemployment claims improved to 225,000 from 236,000 a week earlier. Retail sales surprised to the upside with a print of 0.8% (against 0.3% expected) and import prices came in at 0.7%, up from 0.1% previously.
  • The economic agenda is fairly light today with the European Union’s trade balance, the Bank of England’s (BOE) quarterly bulletin and US data that includes the Empire State Manufacturing Index, capacity utilization rate and industrial production.
  • In addition, BOE Monetary Policy Committee member Andrew Haldane is speaking in Italy.

LME snapshot at 02.39am London time
Latest three-month LME Prices
($ per tonne)
 Change since yesterday’s close ($)
Copper 6,770 -23
Aluminium 2,038 -11.5
Lead 2,520 -5
Zinc 3,178 -9
Tin 18,815 -85
Nickel 11,650 95
SHFE snapshot at 10.40am Shanghai time
Most-traded SHFE contracts
(yuan per tonne)
 Change since yesterday’s close (yuan)
Copper  52,650 360
Aluminium 14,360 85
Zinc 25,250 145
Lead 18,980 -70
Tin  134,410 -190
Nickel  89,710 500

Changjiang spot snapshot on December 15
(yuan per tonne)
 Change (yuan)
Copper  52,530—52,550 70
Aluminium 14,040—14,080 70
Zinc 25,550—26,350 20
Lead 18,950—19,150 -100
Tin  135,500—137,000 -250
Nickel  90,000—90,200 -550
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