Daily Report 211015 2015-10-21
Tuesday domestic and overseas copper market stopped drop, copper price slightly fluctuated. Under the influence of recent weaken Chinese economy data, copper price fell back but, downward trend had released in Tuesday; expectation from market to more Chinese stabilizing policies bolstered the copper market; in addition, expectation of fundamental would be shortage still exist which as well bolster the copper price. The latest expectation from International Wrought Copper Council was global copper fundamental would be balance in 2015 and, would be short of 140,000 tons in 2016; we took it with a grain of salt. Back to copper market, Tuesday LME spots premium edged up to $4.25, inventory decreased 4500 tons. Domestic spots were discount RMB 50 to premium RMB 10. From supply side, supervisory personnel from subsidiary Radomiro Tomic of Chile Codelco accepted the terms on payment, strike came to an end; on 8 October, since payment negotiation had not reached consensus, technical and supervisory personnel from Radomiro Tomic started striking. Chile Salvador copper mine reduced 60 pieces junior managers, of which annual copper output was 54,000 tons in last year. BHP latest third quarter report revealed, since ESCONDIDA copper grade sharply decreased, the output was 377,000 tons and decreased 3% year-on-year; plan of copper output in 2016 fiscal year was 1.5 million tons, decreased 12% compared with 1.7 million in 2015. Technically, copper price had temporarily stopped downward trend and, might rebound in short term.
Domestic soybean spots edged down, northeast soybean stayed in stabilization, northeast spots stopped dropping; demand domestic market would still under sluggish in short term, since trading volume of new grains was poor and current price lacked of representativeness, soybean No.1 contract was expected continue weak pattern.
Soybean meal market slightly retraced in partial areas, current price generally among RMB 2750-2820/ton, US soybean recent retracement and good basis sales in forward made the price in the dilemma of increase and decrease, but global oversupply pattern still maintained, the altitude and strength of DCE soybean meal reviving in short-term still rely on sales rhythm from oil plants and the further performance from US soybean. As for operation, we recommend holding soybean NO.1 contract in shorten at high; holding soybean meal in shorten at light positions.

Natural Rubber
Yesterday Shanghai rubber fluctuated in low point, US dollar spots price had no obvious variation: domestic spots 1270-1280 (0), domestic cargo price 1290-1300 (0), US dollar RSS spots price 1340-1360 (-10), US dollar RSS cargo price 1330-1340 (-10), Singapore cargo price 1310-1330 (-10). From news side: the latest released third quarter financial industry GDP increased 16.1% year-on-year and, mainly came from incensement of bank loan. Overall, fundamental of Shanghai rubber oversupply condition had no obvious changes. Poor macro economy data would be a procedure on financial market risk release in short term; but “stabilizing growth” policy strengthened and “Thirteenth Five Year Plan” came out would bring a policy game chance to the market.
Yesterday PP futures opened low and went high at end, opened at 7080 and ended at 7141; trading volume increased 49146 lots to 772,000 lots; holding increased 16198 lots to 353,000 lots. On spots side, yesterday domestic PP market continue downward trend, price dropped RMB 50-100/ton. Overnight oil price slumped hammered the market, futures opened up low further exacerbated bearish momentum. EXW from PetroChina north china, east china dropped which weakened the bolster to supply cost; merchants shipped following down trend to promote transaction; confidence to latter market was insufficient. Demand from downstream firm offer preferred low price and, purchase moderately based on orders; trading volume was weak; overall trading and investing momentum was poor.
Current main quoted prices for wires of north, east and south markets are RMB 7050-7100/ton, RMB 7250-7300/ton and RMB 735-7500/ton, respectively.
As for operation side, current moving average system arranged in short as weak pattern; recent price was estimated continue weaken volatile trend.
                                                                 Dong LV (Investment Certificate NO. TZ008452)