LIVE FUTURES REPORT 18/09: SHFE lead price rises following stock drop; rest of complex higher

Base metals prices on the Shanghai Futures Exchange (SHFE) were all higher during Asian morning trading on Monday September 18, with lead the outperformer following a 44.4% decline in stocks at SHFE-approved warehouses last week.

The SHFE’s most-traded October lead contract stood at 20,540 yuan ($3,134) per tonne as of 03:25 BST, up by 720 yuan or 3.6% compared with the previous day’s close.

Deliverable lead stocks at SHFE-listed warehouses fell by 13,282 tonnes or 44.4% last week to stand at 29,850 tonnes as of Friday September 15.

The declining stocks have further exacerbated supply tightness amid continuing nationwide environmental inspections in China.

“The supply tightness in lead has not eased as yet. Although the short-term recovery of [London Metal Exchange] stocks put some pressure on lead prices, spot premiums still moved higher and now SHFE lead stocks have fallen quickly – the cycle continues,” Galaxy Futures noted.

Rest of complex stronger

  • The SHFE November zinc price went up 440 yuan or 1.79% to 25,060 yuan per tonne, which also been supported by falling stock.
  • SHFE zinc stocks declined 4,339 tonnes or 5.9% to 74,002 tonnes as of Friday.
  • The SHFE most-traded November copper contract increased 160 yuan or 0.32% to 50,540 yuan per tonne.
  • SHFE copper stocks fell by 3.5% or 6,100 tonnes to 172,847 tonnes in the week ended September 15.
  • The SHFE most-traded January nickel price climbed 510 yuan or 0.58% to 88,270 yuan per tonne.
  • Nickel stocks were down 3,263 tonnes or 5.2% week on week to 63,201 tonnes on Friday.
  • However, the repercussions from further exports licenses being issued in Indonesia should continue to impact the market, ANZ Research noted.
  • The SHFE most-traded November aluminium price increased 110 yuan or 0.68% to 16,360 yuan per tonne as of 03:25 GMT today.
  • SHFE aluminium stocks added 18,746 tonnes or 3.6% last week to stand at 516,884 tonnes on Friday.
  • The SHFE most-traded January tin price rose 1,110 yuan or 0.78% to 144,010 yuan per tonne.
  • SHFE tin stocks decreased 305 tonnes or 2.8% to 10,964 tonnes as of Friday.

Currency moves and data releases

  • The dollar index was recently down 0.02% at 91.85.
  • In other commodities, the Brent crude oil spot price was up 0.13% to $55.69 per barrel, and the Texas light sweet crude oil spot price eased 0.04% to $50.42.
  • In equities, the Shanghai Composite was up 0.31% to 3,364.14.
  • In US data on Friday, core retail sales undershot with a 0.2% rise in August, compared with an expected and previous increase of 0.5% and 0.4%, respectively. Industrial production for August also disappointed with a decline of 0.9% – an increase of 0.1% had been expected.
  • In data today, the EU’s final CPI and the USA’s NAHB housing market index are of note.
  • In addition, Bank of England governor Mark Carney is speaking.

LME snapshot at 0325 London time
Latest 3M  LME Prices
Price ($/t)  Change since Friday’s close ($)
Copper 6,539 32
Aluminium 2,098.5 12.5
Lead 2,394 35
Zinc 3,064 33
Tin 20,590 50
Nickel 11,175 85

SHFE snapshot at 1025 Shanghai time
Most traded SHFE contracts
Price (yuan/t)  Change since Friday’s close (yuan)
Copper (November) 50,540 160
Aluminium(November) 16,360 110
Zinc(November) 25,060 440
Lead(October) 20,540 720
Tin (January) 144,010 1,110
Nickel (January) 88,270 510

Changjiang spot snapshot on September 18
Range (yuan/t)  Change (yuan)
Copper  50,580—50,600 100
Aluminium 16,110—16,150 -60
Zinc 25,600—26,400 120
Lead 20,350—20,550 350
Tin  141,500—143,500 -750
Nickel  88,000—88,600 -450
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