Domestic and Imported Supply Both Contracted, National Copper Inventories Fell Synchronously YoY [SMM Weekly Data]

SMM, July 20:

Data Summary: As of Monday, July 20, SMM copper inventories in major Chinese regions fell 32,700 mt WoW to 107,300 mt. Total inventories dropped 11,300 mt compared to 118,600 mt in the same period last year, with destocking observed across all regions.

Specifically, Shanghai saw sustained destocking as domestic smelter maintenance has not fully concluded, dragging down domestic copper cathode arrivals, combined with fewer imported cargoes. Jiangsu was stable, with no significant inventory changes. In Guangdong, both supply and demand were sluggish; some spot cargoes flowed to east China markets, driving regional inventories lower in tandem.

Market outlook: Supply side, arrivals of both imported and domestic copper cathode are unlikely to improve in the near term, keeping overall circulating supply tight; demand side, downstream performance remains weak during the off-season, limited to just-in-time procurement. Surveys indicate the copper cathode rod operating rate is expected to fall to 63.21% this week, down 1.89 percentage points WoW. Under the overall supply-demand pattern, with tight spot supply in China and insufficient downstream purchasing power, national copper cathode social inventory is expected to extend its destocking trend next week, though the pace of decline is likely to narrow.