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“If prices break 415 mark then the futures are expected to move towards 412 in intra-day trade. Overall sentiments are looking sideways to bearish till the moment it does not break 420 on upside.” said Amr..

25 Mar 2013

Commodity Online
Cyprus issue had kept not only the energy markets, but the base metals too in tenterhooks. The issue was that of weakened sentiments.

Copper futures for delivery on India's MCX April contract opened Monday in red tracking selling pressure in the international market. The case of Rupee appreciation also put pressure on prices towards the downside. The futures are trading at Rs.416.75 registering a loss of 0.71% as of 05.54 PM IST.

The contract has major support at 415 and resistance at 420.

“If prices break 415 mark then the futures are expected to move towards 412 in intra-day trade. Overall sentiments are looking sideways to bearish till the moment it does not break 420 on upside.” said Amrita Mashhar, Research Analyst with Commodity Online.

Meanwhile reports arrived that China Copper cathode imports fell to 215Kt in February, representing declines of a 43% y/y 12% m/m. The data comes from Barclays.

Taken in-line with robust cathode export levels, which at 39Kt represented a firm improvement versus the 24Ktm average seen over the past three months and of versus negligible levels a year ago, overall net cathode imports dropped to 176Kt (-53% y/y).

This is the lowest level of net cathode imports into China since May 2011. In the context of rising bonded warehouse stock during the month (which estimate rose 15Kt to 765Kt) and SHFE stock levels (+20Kt to 225Kt), it demonstrates the tepid state of end-user demand during the month.

Certainly, the strength of cathode exports reflected enhanced incentives on offer from LME warehouses.

“We do, however, believe that recent improvements in the SHFE-LME arbitrage in March indicate that refined imports both this month and next should improve sequentially from February’s levels as more material will inevitably be booked on spot.” Barclays noted in a report.

In line with the weakness at a refined level, scrap imports were also weaker (302Kt, -25% y/y, -20% m/m), which we believe reflects the impact of Chinese customs clampdowns on the sector.


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