LIVE FUTURES REPORT 26/05: LME copper price up 1.5%; 25k inflow of aluminium at Port Klang

The three-month copper price was most recently trading at $5,369.50 per tonne, up by $81 per tonne (1.5%) from last Friday’s 5pm close of $5,288.50 per tonne. The LME was closed on Monday due to the spring bank holiday in the United Kingdom.

The three-month nickel price was up by $75 per tonne (0.6%) at $12,325 per tonne, while most of the other LME base metals were also trading higher this morning while they react positively to news of more economies opening up following coronavirus-related shutdowns.

“LME copper followed the [Shanghai Futures Exchange] contract higher… Asian stocks and US equity index futures gained as economies globally reopened, outweighing any geopolitical tensions,” analysts with Marex Spectron said.

The three-month aluminium price was little changed this morning at $1,505 per tonne, compared with a close of $1,506.50 per tonne last Friday, after gaining more than 3% last week.

Light metal stocks continue to rise with a further 25,400 tonnes delivered into LME sheds in Port Klang, Malaysia this morning. Over 70% of total aluminium stocks in LME warehouses are held in Malaysia. Total aluminium stocks now stand at 1.4 million.

This compares with deliverable aluminium stocks at SHFE warehouses, which declined for a ninth straight week by 8.6% to 322,060 tonnes last week.

Aluminium market participants continue to watch the spreads closely, which are one of the main drivers of physical premiums. The benchmark cash/three-month spread has narrowed to $25.50 per tonne this morning, from $33.50 per tonne a week ago.

“Everyone is watching the spreads and worried about it narrowing further. Cash and carry is how people are making their money right now, backwardations would cause issues,” a trader said.

Some forward spreads are also a cause for concern, the June/three-month spread is currently flat at $0 per tonne while the August/three-month spread has moved into a $0.50-per-tonne backwardation this morning.

Zinc was the only base metal in negative territory this morning, edging $13 per tonne lower to $1,972.50 per tonne.

Other highlights

• The dollar index was down 0.35% this morning at 99.46.
• According to the World Trade Monitor, global trade volumes fell by the most since 2009 in March, down 4.3% from a year earlier.
• Data out later in Europe includes UK realized sales from the Confederation of British Industry (CBI) and there is a European Central Bank financial stability review report.
• There is also new home sales and consumer confidence figures from the United States. US Federal Open Market Committee member Neel Kashkari is also speaking.