Shanghai copper firm

Shanghai copper futures firmed slightly while other metals sagged on Wednesday, as London Metal Exchange zinc continued to grab the spotlight.
LME zinc hit an all-time high on Tuesday its ninth in ten trading days as zinc inventories in LME warehouses fell below 100,000 tonnes for the first time since March 1991. Zinc hit $4,525 a tonne on Tuesday before closing at $4,500 a tonne, up 2.2 percent. "Zinc and lead are monsters. Zinc spreads are moving out like crazy, which implies a few guys got caught short," said a dealer in Singapore.
Record zinc prices are attracting Chinese exports, as two smelters return from maintenance, Chinese traders said. In Asian trade on Wednesday, zinc was bid at $4,490 a tonne, down $10.
Zinc has risen 136 percent so far this year. LME lead also hit a record high of $1,740 a tonne on Tuesday, before closing at $1,735 a tonne. It retreated $15 to be bid at $1,720 a tonne in Asian trade, but is still up 64 percent this year. Shanghai copper futures firmed in thin trade on Wednesday, keeping pace with small LME gains on Tuesday.
Shanghai's most-active contract, January, ended the session at 68,530 yuan ($8,709) a tonne, up 130 yuan. Spot copper climbed 100 yuan, to range between 69,500 yuan and 69,800 yuan a tonne. LME copper futures slid by 0.2 percent to $7,400 a tonne on Wednesday, after rising 0.7 percent on Tuesday. "Copper's just hanging around between $7,200 and $7,800, while people wait for something to happen.
A lot of money's gone into other markets," the Singapore-based trader said. In fundamental news, trade unions and management are positioning themselves ahead of the end of labour contracts at Chile's Codelco Norte, the largest division of the world's top copper miner.
The biggest trade union said on Tuesday it was waiting to receive a preliminary offer from the company before deciding if it would participate in contract talks. Shanghai aluminium futures retreated marginally on Wednesday, but remain supported by demand from fabricators.
The most-active January contract lost 50 yuan to end the session at 20,410 yuan a tonne. LME aluminium also slipped in relatively lacklustre trade on Wednesday. Spreads are narrowing, traders said. Bids fell $2 to $2,790 a tonne. The backwardation had widened considerably following the news of Chinese tax changes that sought to limit exports of primary aluminium, they said. Backwardation is the premium of the front month contracts over those further out, and a steeper backwardation implies tighter prompt supply.