Active Downstream Restocking After the Holiday, Suppliers Holding Prices Firm to Support Stabilization of SHFE Copper Discount [SMM Shanghai Spot Copper]

SMM April 7:

During the morning session, the SHFE copper 2604 contract opened with a sharp jump before pulling back quickly, then stabilized and rose rapidly, followed by sideways movement, and pulled back toward the close. The opening price was 96,240 yuan/mt, after which prices jumped to 96,680 yuan/mt, then quickly pulled back to 96,220 yuan/mt. Prices then stabilized and rose rapidly, touching a high of 96,950 yuan/mt, before fluctuating between 96,650 yuan/mt and 96,920 yuan/mt. Near the close, prices pulled back somewhat, with the closing price at 96,610 yuan/mt. The inter-month Contango price spread ranged from 70 yuan/mt to 10 yuan/mt, and the import profit margin for the current-month SHFE copper ranged from a loss of 100 yuan/mt to a profit of 20 yuan/mt.

Intraday, the selling sentiment for copper cathode in Shanghai was 2.76, down 0.03 MoM, while the procurement sentiment was 2.79, up 0.05 MoM.. At the start of the morning session, suppliers offered standard-quality copper at discounts of 70 yuan/mt to 10 yuan/mt, with Lufang, Xiangguang and others quoted at a discount of 40 yuan/mt, Dajiang PC, Tiefeng, Jinfeng, Zijin, OLYDA and others quoted at discounts of 80 yuan/mt to 50 yuan/mt, and Jinguan, Jinxin, Jintun PC quoted at a discount of 50 yuan/mt ex-factory. Some low-priced cargoes were quickly transacted. High-quality copper such as Guixi and Jintun plate were quoted at discounts of 20 yuan/mt to parity. Registered SX-EW copper ESOX was quoted at a discount of 90 yuan/mt. In the second trading session, suppliers slightly raised prices. High-quality Jinchuan (plate) was quoted at a premium of 10 yuan/mt, standard-quality SPCC-ILO was transacted at a discount of 40 yuan/mt, and Zijin, OLYDA and others were quoted at a discount of 60 yuan/mt. In addition, available spot cargo in Jiangsu was tight, making it difficult to find low-priced cargoes in the market.

Looking ahead to tomorrow, the Shanghai spot copper market is expected to remain under pressure. Supply side, although some suppliers offloaded cargoes intraday, discounts did not widen significantly. Going forward, suppliers are expected to show stronger willingness to hold prices firm, with some enterprises controlling shipments pace, providing support for spot prices. Tight available cargoes in Jiangsu further strengthened suppliers' willingness to hold prices firm. Demand side, on the first trading day after the Qingming Festival, downstream enterprises showed strong enthusiasm to resume operations, procurement sentiment recovered, and just-in-time procurement support remained. Overall, driven by the combined effect of suppliers holding prices firm and downstream restocking, Shanghai spot copper prices against the 2604 contract are expected to remain at a discount tomorrow.