SHFE base metals stocks exhibit mixed moves; copper climbs 12%

Deliverable stocks of base metals at Shanghai Futures Exchange-registered warehouses were on divergent paths in the week to Friday August 26, with copper topping the gains in percentage terms, while tin led the declines

Copper inventories totalled 34,898 tonnes on Friday, up by 3,693 tonnes (or 11.8%) from a week earlier. The largest inflow of the red metal, at 4,823 tonnes, was registered at the SIPG Logistics warehouse in Shanghai, according to the exchange’s weekly inventory report.

Quiet spot buying activity and a rally in SHFE copper prices prompted deliveries of the metal into warehouses this week, market sources told Fastmarkets.

“China’s elevated spot premium discouraged spot buying, and this, together with rising SHFE copper prices, explains the increase in stocks,” a Shanghai-based trader said.

High spot premiums in China’s domestic market had previously spurred buyers’ appetite for imports, pushing up premiums for copper cathode being imported into the country.

But premiums weakened at the start of this week, resulting in less supportive conditions for import activity.

Fastmarkets’ benchmark copper grade A cathode premium, cif Shanghai, was assessed at $80-96 per tonne on Friday, down by $13-15 per tonne from $95-109 per tonne a week earlier.

Elsewhere, tin stocks registered a noticeable decline this week, falling by 14% week on week to 2,431 tonnes on Friday.

Other SHFE base metals stock changes• Aluminium stocks up by 6,678 tonnes (3.4%) to 204,564 tonnes
• Lead stocks rose by 470 tonnes (0.7%) to 71,822 tonnes.
• Zinc stocks fell by 5,918 tonnes (6.2%) to 90,288 tonnes.
• Nickel stocks decreased by 280 tonnes (7.3%) to 3,538 tonnes

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