Slow Resumption Pace: Brass Billet Operating Rate Only 17.12% This Week

Looking ahead to next week, SHFE copper spot supply is set to increase, with Peruvian and Japanese cargoes visible intraday. The contango spread between adjacent months widened slightly, and persistent willingness to deliver to warehouses further diverts spot liquidity. Although some suppliers hold prices firm, expectations of warrant outflows pressure spot premiums/discounts. Downstream production has not fully resumed; procurement sentiment is cautious but recovering. Amid supply-demand mismatch, social inventory is expected to continue building. Overall, supply pressure will keep spot discounts under pressure next week.

[Shanghai spot copper] Looking ahead to next week, spot copper supply continues to increase, with Peruvian and Japanese cargoes visible intraday. From a market structure perspective, the contango spread between nearby futures contracts has widened slightly, and suppliers' willingness to ship to delivery warehouses persists, further diverting spot liquidity. Although suppliers showed strong intentions to hold prices firm intraday, with some brand quotations remaining stable, expectations of subsequent warrant outflows remain, which will exert further pressure on spot premiums/discounts. On the demand side, downstream sectors have not fully resumed production, and procurement sentiment, while rebounding, remains cautious. Under the supply-demand mismatch, social inventory continues its buildup trend. Overall, with supply pressure dominating, spot discounts are expected to remain under pressure next week.

In North China today, spot #1 copper cathode prices against the front-month contract were at a discount of 500-420 yuan/mt, with an average discount of 460 yuan/mt, unchanged from the previous trading day. Transaction prices ranged from 101,530-102,030 yuan/mt, with an average of 101,780 yuan/mt, down 210 yuan/mt from the previous trading day.