SMM June 2 update:
During the morning session, the SHFE copper 2606 contract showed a trend of retreating after a rapid rise before stabilizing. The opening price was 105,620 yuan/mt. After opening, prices quickly surged, touching a high of 106,390 yuan/mt, then pulled back to 105,640 yuan/mt. After stabilizing, prices rebounded slightly, with a closing price of 105,860 yuan/mt. The inter-month Contango price spread between futures contracts ranged from 160 yuan/mt to 90 yuan/mt. The import profit margin for SHFE copper against the 2606 contract for the current month ranged from a loss of 640 yuan/mt to a loss of 570 yuan/mt.
Intraday, the selling sentiment for copper cathode in the Shanghai region was 2.61, down 0.11 MoM, and the purchasing sentiment was 2.55, down 0.09 MoM. Historical data can be found in the database. At the start of the morning session, suppliers offered standard-quality copper at discounts of 130 yuan/mt to 80 yuan/mt, among which Xiangguang, Lufang, and JCC were quoted at discounts of 90 yuan/mt to 80 yuan/mt. Dajiang PC, Zhongtiaoshan PC, Tiefeng, and Zijin were offered at discounts of 130 yuan/mt to 120 yuan/mt. Jinguan, Jinxin, Jintun PC, and Jinfeng were quoted at discounts of 80 yuan/mt for cargoes with invoices dated this month on an ex-factory basis. High-quality copper sources were scarce, with Guixi and Jintun large plates quoted at discounts of 20 yuan/mt to premiums of 10 yuan/mt. Only some registered SX-EW copper such as ESOX was available for circulation, so quotes remained firm at discounts of 150 yuan/mt. Entering the second session, suppliers slightly lowered prices. Jinguan, Jinxin, and Jintun PC were successively traded at ex-factory discounts of 100 yuan/mt to 80 yuan/mt. Tongguan was successively traded at ex-factory discounts of 60 yuan/mt to 50 yuan/mt. Non-registered copper was successively traded at discounts of 320 yuan/mt to 300 yuan/mt.
Looking ahead to tomorrow, the copper price center is expected to shift upward. Downstream enterprise consumption is expected to weaken, but as the inter-month Contango price spread between futures contracts widens, suppliers' willingness to ship to delivery warehouses is expected to increase. They are expected to hold prices firm and hold back from selling, and available low-priced sources may tighten, providing some support for spot discounts. Affected by rising copper prices, the price difference between copper cathode and copper scrap is expected to widen, driving non-registered spot copper discounts to expand further. Overall, under the influence of high copper prices and widening price spreads between futures contracts, Shanghai spot copper quotes against the 2606 contract are expected to remain at discount levels tomorrow.
