Tight Supply Continues to Ferment, Premiums Surge; Market Shows Supply-Demand Weakness This Week [SMM Yangshan Copper Weekly Review]

Published: Jul 16, 2026 14:04

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This week (July 13-16), the weekly average B/L transaction price range for Yangshan copper premiums was $84-95/mt, QP August, averaging $90/mt; the weekly average warrant transaction price range was $85-95/mt, QP August, averaging $90/mt; and EQ copper CIF B/L was $53-61/mt, QP August, averaging $57/mt. As of July 16, the ex-FX SHFE/LME copper price ratio for LME copper against the SHFE copper 2608 contract stood at 1.1426, with an import loss around 374.65 yuan/mt, widening from the prior period. As of Thursday, the LME copper front-end was in a contango structure, with the spread between the August and September dates at −$7.45/mt. Currently, mainstream offer indications for pyrometallurgical registered copper B/L are around $100-110/mt, and for EQ copper CIF B/L around $65-70/mt.

This week, Yangshan copper premiums continued their upward momentum, still driven primarily by expectations of persistently tight market supply, which prompted suppliers to hold back from selling. Available cargoes were scarce during the week, and domestic social inventory continued destocking, giving upstream sellers strong confidence to hold prices firm. Spot premiums repeatedly hit new highs for the year, but downstream demand showed mediocre performance, with limited actual transactions. On the price ratio front, the ratio weakened over the week, yet sellers held an optimistic outlook for the near term. Overall, sellers’ firm pricing and downstream fear of high prices intertwined, presenting a weak supply-demand picture.

According to SMM, as of Thursday (July 16), domestic bonded zone copper inventories increased by about 3,300 mt WoW from July 13 to 38,900 mt. Shanghai bonded inventory rose 2,900 mt WoW to 34,800 mt, and Guangdong bonded inventory rose 400 mt WoW to 4,100 mt. The bonded zone inventory shifted from destocking to buildup, mainly because some suppliers took an optimistic view on future premiums and the price ratio, showing low willingness to sell and leading to reduced warehouse withdrawals.

Looking ahead, amid the siphoning effect from North America and production losses in Africa due to rising production costs, the market will continue to trade the tight availability of cargoes in the near term. However, it is worth noting that LME cancelled warrants have increased significantly recently, and according to SMM, some cargoes are already being shipped to China. Attention should be paid to the volume of this supply replenishment and the downstream's actual consumption capacity to absorb the high premiums.

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.

Images in this article contain AI-translated captions for reference only.

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