Some Downstream Enterprises on Holiday, Trading in SHFE Copper Spot Market Sluggish [SMM Shanghai Spot Copper]

SMM Feb. 5:

Today, SMM's #1 copper cathode spot prices against the current month 2602 contract were quoted at a discount of 30 yuan/mt to a premium of 100 yuan/mt, with the average price at a premium of 35 yuan/mt, down 5 yuan/mt from the previous trading day; SMM's #1 copper cathode prices were 101,320-101,790 yuan/mt. In the morning session, the SHFE copper 2602 contract opened higher with a gap and then pulled back slightly, opening at 101,900 yuan/mt. After opening, prices rose slightly, touching a high of 102,120 yuan/mt, then pulled back, fluctuating between 101,300 yuan/mt and 101,700 yuan/mt, and closed at 101,300 yuan/mt. The Contango spread between nearby contracts was between 390 yuan/mt and 270 yuan/mt, while the import profit margin for SHFE copper's current month contract ranged from a loss of 680 yuan/mt to 580 yuan/mt.

Intraday sales sentiment increased compared to the previous trading day, while purchasing sentiment dropped slightly. In the Shanghai region, copper cathode sales sentiment was 2.79, up 0.24 MoM, and purchasing sentiment was 2.74, down 0.14 MoM. At the beginning of the morning session, suppliers offered standard-quality copper at a discount of 20 yuan/mt to a premium of 70 yuan/mt. High-quality copper, including Jinchuan (plate) and Guixi, due to scarce supply, was quoted at a premium of 100 yuan/mt to 130 yuan/mt. Among them, Polish plate, Lufang, Xiangguang, JCC, etc., were quoted at a premium of 10 yuan/mt to 70 yuan/mt; Zijin, ISA, Yuguang, Dajiang HS, etc., were quoted at a discount of 10 yuan/mt to a premium of 10 yuan/mt; Southeast Tiefeng was quoted at a discount of 40 yuan/mt to 30 yuan/mt and traded quickly. Entering the second session, suppliers showed a strong willingness to hold prices firm, with almost no price changes. Jinguan, Jintun PC, and Tongguan were quoted at a premium of 30 yuan/mt to 50 yuan/mt; SX-EW copper from Myanmar was quoted at a discount of 50 yuan/mt to 30 yuan/mt; non-registered copper traded successively at a discount of 150 yuan/mt to 100 yuan/mt.

Looking ahead to tomorrow, spot premiums/discounts are expected to face downward pressure. Intraday copper prices rose slightly, suppressing downstream demand, and actual market transactions were sluggish; coupled with some suppliers dumping cargoes, spot premiums/discounts dropped slightly. Supply side, some ratio-locked cargoes secured earlier when the import window opened have partially arrived and entered circulation, and attention should be paid to subsequent arrivals; short-term spot supply is expected to increase gradually. Demand side, as some downstream enterprises enter the holiday period and most top-tier enterprises have completed pre-holiday stockpiling, actual purchasing demand shows a weakening trend.