Shanghai copper futures edged down on Monday as concerns over Chinese demand increased slightly after the country's customs data showed a big drop in imports of refined copper and alloy. Shanghai copper futures edged higher in trade, but soon ran out of steam as London Metal Exchange copper prices drifted down from Friday's closing level.
Shanghai's most-active December copper contract closed trade down 180 yuan at 69,730 yuan a tonne compared with Friday's settlement. The December contract ranged between 69,630 and 70,100 yuan in trade. "Copper lacks clear direction now, but copper and other base metals have been performing well despite seeing sharp falls in other commodities, such as oil," said a trader at a Tokyo-based trading house.
"The strength in tin and nickel could be indirectly providing support, but I cannot be too bullish about the market outlook for copper," he said.
The market was closely watching demand for copper in China to determine the trend and the import data on Monday could have weighed on prices, traders said. China's official customs figures on Monday showed those imports of refined copper and alloy in the first nine months fell 39.6 percent from a year.
Exports, meanwhile, jumped 232.4 percent over the same period. On Friday, copper and aluminium futures fell following news China would no longer allow duty-free imports of the refined metals in order to export finished products, but the market showed little further reaction to the news.
Still, resistances on the third-position continuation chart were seen at 71,050 yuan a high reached on October 9 and 71,110 yuan a high hit on September 19. A long-term technical support was found around 69,238 yuan, which is the 50-day moving average. Spot Shanghai copper prices hovered between 70,350 and 70,800 yuan, down 550 yuan from Friday.
The key three-month LME copper futures contract was trading down $25, or 0.3 percent, at $7,435/7,475 per tonne against on Friday's London kerb close of $7,460. "It's very tough to buy strongly now when we cannot figure out the direction in London," said an analyst at a Shanghai-based brokerage.
Shanghai's most-active December aluminium futures contract closed the session up 80 yuan at 20,160 yuan compared with Friday's settlement. "Aluminium futures may turn stronger in the rest of the year as stocks both in London and Shanghai have been declining for a period and may support prices," said CIA Luoyi, an analyst at China International Futures Corp in Shanghai.
Bullishness in LME tin and nickel provided overall support, although they were little changed in Asia from London closes. Benchmark three-month LME tins were little changed at $9,650/$9,850 per tonne against $9,775 in London. On Friday, tin reached a 17-year peak of $10,000 a tonne on supply problems in Indonesia.
Some small tin smelters have ceased operation in Indonesia's tin producing Bangka Island after police closed three smelters operating without proper permits.
On Thursday, PT Timah TDK, the world's largest integrated tin miner said it had set aside $10 million to buy tin ore from local miners on Bangka Island to help resolve the crisis. Three-month nickel on LME was little changed at $30,700/30,900 per tonne from $30,750 in London.
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