Shanghai Copper ended off lows on Wednesday as investors shrugged off sluggish demand and the Shanghai Futures Exchange’s (SHFE) move to increase margin requirements for some contracts.

The most-traded copper contract on SHFE closed daytime trading up 0.04% at 101,280 yuan ($14,544.41) a metric ton, after dropping more than 1%.

The benchmark three-month copper on the London Metal Exchange rose 1.10% to $12,894.50 a ton as of 0740 GMT.

The red metal remained range-bound near record highs, despite sluggish spot demand and SHFE move on Tuesday to hike margin ratios and widen daily price limits for some metals following last year’s rally. The bourse’s measures were seen to stabilise prices and led to the session’s earlier loss.

Shanghai copper has gained 1.58% so far this year, hitting a record 105,870 yuan on January 7.

Copper’s strength came from expectations of short supply due to mine disruptions at a time when the red metal is playing a key role in data centers and electrification.

Refined copper supply is also expected to be tightened outside the U.S., as a CME premium against the LME amid tariff worries continued to prompt shipping into the U.S.

Demand remained poor amid higher prices. The Yangshan copper premium (SMM-CUYP-CN), a gauge of Chinese demand for imported copper, was at $26 a ton on Tuesday, the lowest since late July, 2024.

In the domestic market, copper premium (SMM-CU-PND) flipped to a discount of 150 yuan a ton, indicating a lack of buying interest in the spot market.

Tin led gains among SHFE base metals. The most-active contract surged 5.79% to 418,420 yuan a ton, while also leading gains on the LME, up 5.54% to $52,150 a ton.

Indonesia’s military-backed crackdown on illegal mining activities continued to unnerve the industry, pushing up tin prices.

Among other SHFE base metals, aluminium rose 0.56%, nickel gained 0.39%, zinc dipped 0.20% and lead shed 0.67%.

On LME, aluminium rose 1.01%, zinc added 0.54%, lead gained 0.35%, and nickel climbed 2.48%.
Source: Reuters