Asian morning trade on May 9th

Tuesday May 9 is a day when copper prices on the SHFE went higher, speaking about Asian morning trade . There is definitely some back up in the release of China’s better-than-expected trade balance. Anyway, gains were suppressed by concerns of weakened demand from the world’s largest copper consumer.

Price of the most active SHFE June copper was up 70 yuan ($10) to 44,720 yuan per tonne. Regarding as of 03:18 BST with around 11,510 lots changing hands so far. Open interest of the contract was at around 35,660 positions.

China’s trade balance

China’s dollar-denominated trade balance for April stood at $38.1 billion. This is exceeding a forecast of $35.3 billion. And especially March’s balance of $23.9 billion. That is a sign of healthy boost up in imports as well as the exports.

Every way, copper prices were under pressure after the release of disappointing import data from China. These data showed total copper imports into the Asian nation fell. And they fell to their lowest level since October 2016. China’s total copper imports for April fell 33% year-on-year to 300,000 tonnes. Making them down from 450,000 tonnes in the same month last year.

“This was tempered by a strong increase in copper concentrate imports, up 7% y-o-y nevertheless ongoing supply disruptions impacting concentrate availability. Everyway, the fall in refined copper imports revived concerns about weak demand at the world’s largest consumer.” (ANZ)

In the meantime, the dollar had a step back this morning – falling 0.03% to 99.11 as of 03:18 BST . Also giving fine support to base metals prices.

Nickel prices UP due to reduced output

Firstly, The SHFE September nickel contract surged 350 yuan to 74,550 yuan per tonne.
“Nickel prices have been under pressure throughout April. This increased market participants’ appetite for dip-buying. Specially on top of which, nickel’s output was largely reduced in April.”
Secondly, China produced 12,580 tonnes of nickel in April. Which is down exactly 3,220 tonnes y-o-y. And 770 tonnes from the prior month.

“Following, the market sees a low stainless steel inventory prone with traders. There was a wave of rallies in April to May 2015 driven by low availability of stainless steel stocks in traders’ hands. So they needed to build up stocks. It is possibly an indication of better nickel demand in recent future.”

Other base metals going positive

Thirdly, June aluminium price was up 15 yuan to 13,675 yuan per tonne. Observing the June zinc price, it rose 135 yuan to 21,905 yuan per tonne.

In the meantime, june lead price inched up 25 yuan to 15,945 yuan per tonne. Finally, the September tin price surged 1,590 yuan to 139,990 yuan per tonne.

Currencies & data

Speaking about oil prices and currencies, the Brent crude oil spot price declined 0.2% to $49.32 per barrel. While the Texas light sweet crude oil spot price was down 0.21% at $46.42.
Observing equities, the Shanghai Composite dipped 0.16% to 3,073.76.  In data, EU Sentix investor confidence for May was better than expected at 27.4 – smashing expectations of 25.3 and up from 23.9 previously. April’s US labour market conditions index was at 3.5, remotely under the precedent month’s reading of 3.6.