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The most-traded December copper contract on the SHFE was at 55,670 yuan ($8,387) per tonne as of 03:44 BST, up 1,280 yuan from Monday’s close, with around 202,000 lots of the contract having changed hands so far.
Other than a decline in the dollar since Monday, market observers also cited positive sentiment in the market ahead of major industry conferences, stricter regulations over scrap imports in China and lower London Metal Exchange copper stocks as providing support for red metal prices.
“There is upside for copper prices possibly up till early November as the upcoming industry conferences are fuelling positive sentiment,” a Beijing-based metals analyst said.
LME Week kicks off in London next week while the Cesco Asia Copper Week takes place in Shanghai at the end of November.
China is expected to tighten its scrap import policies with market participants estimating 300,000-1 million tonnes of China’s scrap copper imports could be affected by a ban.
LME copper inventories fell another 4,175 tonnes to 283,450 tonnes yesterday, with ANZ Research noting that stocks have fallen 10% over the past four weeks.
Meanwhile, the most-traded January nickel contract jumped 1,440 yuan to 96,240 yuan per tonne as of 03:44 BST, with close to 352,000 of the contracts having traded so far.
Nickel continues to be supported by concerns over tightening Chinese nickel pig iron (NPI) production and nickel metal supply, and expected demand from Tsingshan Group’s Indonesia stainless steel mill and the global growth in electric vehicle batteries, industry watchers said.
Shandong Xinhai Technology, China’s largest NPI-only producer, has been ordered to halve its production from November 15 to alleviate pollution, which could remove around 200,000-250,000 tonnes of NPI from the market over the four month period, Metal Bulletin understands.
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