LIVE FUTURES REPORT 26/12: SHFE aluminium down amid concerns over rising inventories; copper up as stocks fall

The three-month aluminium price on the Shanghai Futures Exchange (SHFE) fell during Asian morning trading hours on Tuesday December 26 amid concerns over stock levels in 2018.

The most-traded SHFE February aluminium contract price decreased 180 yuan - or 1.2% - to 14,535 yuan ($2,222) per tonne as of 10.00am Shanghai time, as market participants fretted over the likelihood of excessively high aluminium inventories in the first half of 2018.

“Chinese domestic aluminium stocks will remain above 1.8 million tonnes in the dirst quarter of 2018. Even in the second quarter - the traditionally high consumption season - inventories are unlikely to fall much,” China’s Minmetals Jingyi Futures said.

“In addition, the anti-dumping measures from the United States have influenced China’s aluminium exports, which is also negative for reducing the levels of stocks,” according to Galaxy futures daily report.

The most-traded February copper contract on the SHFE stood at 54,760 yuan per tonne, up 60 yuan - or 0.1% - from the previous session’s close.

“Supply of scrap copper remains tight, which adds to the demand for refined copper and that is making [refined copper] stocks fall,” according to China’s Minmetals Jingyi Futures.

During the week ended Friday December 22, SHFE copper stocks fell by 1,918 tonnes, or 1.3%, over the previous week to 140,211 tonnes.

Lead and nickel down, zinc and tin up

  • The SHFE February lead contract price fell by 105 yuan to 19,020 yuan per tonne, down 0.5% compared with its previous closing price.
  • “Demand in the physical market is weak, and that has also influenced the futures market,” according to a lead trader in Shanghai.
  • The SHFE May nickel contract price decreased 230 yuan, or 0.2%, to 94,830 yuan per tonne.
  • The SHFE February zinc contract price was slightly up 125 yuan, or 0.5%, to 25,425 yuan per tonne.
  • The SHFE January tin contract price gained 590 yuan, or 0.4%, to 138,790 yuan per tonne.

Currency moves and data releases

  • The dollar index was up by 0.02% at 93.26 as of 10.46am Shanghai time.
  • In equities, the Shanghai Composite was up 0.03% to 3,281.53.
  • In data out today, US S&P composite-20 HPI and Richmond manufacturing Index numbers are due later.
SHFE snapshot at 1000 Shanghai time
Most traded SHFE contracts
Price (yuan/t) Change since yesterday’s close (yuan)
Copper (February) 54760 60
Aluminium(February) 14535 -180
Zinc(February) 25425 125
Lead(February) 19020 -105
Tin (January) 138790 590
Nickel (May) 94830 -230

Changjiang spot snapshot on Tuesday December 26
Range (yuan/t) Change (yuan)
Copper 54,290-54,310 -360
Aluminium 14,100-14,140 -310
Zinc 25,460-26,260 -310
Lead 19,000-19,200 -110
Tin 139,000-140,000 500
Nickel 94,050-94,250 -1,350

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