Month-End Downstream Demand Decline Drove Inventory Higher, Spot Premiums Fell Notably [SMM South China Copper Cathode Spot Weekly Review]

Published: May 28, 2026 16:34

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SMM News, May 28:

Guangdong region: Premiums in this region continued to trend lower this week, mainly driven by increased arrivals and weak consumption. As of Thursday, high-quality copper was quoted at 120 yuan/mt, down 120 yuan/mt WoW; standard-quality copper was quoted at a premium of 50 yuan/mt, down 110 yuan/mt WoW; SX-EW copper was quoted at a discount of 20 yuan/mt, down 110 yuan/mt WoW. On Thursday, the price spread of standard-quality copper premiums between Shanghai and Guangdong showed Guangdong was 230 yuan/mt higher. The relatively small price spread, combined with weakening consumption in Guangdong recently and the fact that earlier southbound cargoes had not yet been fully consumed, meant no additional cargoes moved south. According to SMM statistics, as of Thursday, total inventory in Guangdong warehouses was 21,500 mt, up 1,200 mt WoW, with warrants totaling 5,900 mt, up 1,000 mt WoW. Specifically: warehouse arrivals this week were 12,400 mt/week, down 4,600 mt/week WoW, below the annual average (14,000 mt/week); maintenance at nearby smelters and reduced southbound cargoes were the main reasons. Warehouse withdrawals were 11,000 mt/week, down 2,700 mt/week WoW, below the annual average (14,200 mt/week). Production cuts at some enterprises toward the month-end were the primary cause of the notable decline in demand.

Looking ahead to next week, as downstream enterprises resume production, demand is expected to increase accordingly, while supply is not expected to rise significantly. Inventory is expected to decline again next week, and premiums are expected to stop falling and rebound.

(The above information is based on market data collection and comprehensive assessment by the SMM research team. The information provided in this article is for reference only. This article does not constitute direct investment research advice. Clients should make prudent decisions and not replace independent judgment with this information. Any decisions made by clients are not related to SMM.)

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

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