The pullback in copper prices stimulates a recovery in dip-buying; the market awaits the US Fed meeting, and copper prices move sideways [SMM Copper Morning Meeting Notes]

2026.7.29 Wednesday
Futures: Overnight, LME copper opened at $13,613/mt, dipped to $13,597.5/mt early in trading, then its center rose to touch $13,700/mt before retreating to close at $13,644.5/mt, down 0.84%, with trading volume of 14,000 lots and open interest at 247,000 lots, a decrease of 758 lots from the previous trading day, driven by long liquidation. Overnight, the most-traded SHFE copper 2609 contract opened at 104,560 yuan/mt, initially fell to 104,460 yuan/mt, then saw its center rise to a high of 105,120 yuan/mt near the close, and finally settled at 104,940 yuan/mt, down 0.1%, with trading volume of 26,000 lots and open interest at 201,000 lots, a decrease of 23.48 million lots from the previous trading day, driven by short covering.
[SMM Copper Morning Brief] News:
(1) On Tuesday, July 28, data released by Kazakhstan’s National Bureau of Statistics showed that exports of copper cathode and unwrought copper alloys reached 165,260 mt in January–May 2026, up 17.2% YoY from 165,260 mt in the same period of 2025. By export value, total exports amounted to $2.307 billion, compared with $1.454 billion in the same period of 2025, up 58.6% YoY.
Spot:
(1) Shanghai: On the morning of July 28, the SHFE copper 2608 contract opened lower with a gap and then consolidated sideways. It opened at 105,220 yuan/mt, continued to decline to a low of 104,860 yuan/mt, then edged up and mostly traded between 104,900 yuan/mt and 105,070 yuan/mt, closing at 104,990 yuan/mt. The backwardation monthly spread was at 110–170 yuan/mt, and the import profit margin for SHFE copper against the 2608 contract stood at a loss of 660–750 yuan/mt. Looking ahead, copper prices are expected to pull back today, prompting some downstream dip-buying inquiries and purchases, with purchasing sentiment in Shanghai improving from the previous trading day. However, according to SMM, end-user orders remain concentrated around 104,500 yuan/mt, and a gap still exists between spot transaction prices and downstream psychological price levels, limiting actual demand growth. With the month-end approaching, some buyers still need to replenish cargoes with invoices dated this month, and such cargoes are relatively tight, providing support to their quotes. In contrast, supply of cargoes with next-month invoices is more ample, and suppliers show strong willingness to sell. The price spread between this-month and next-month invoice cargoes is expected to persist. Overall, given dip-buying driven by the price pullback and support from this-month invoice demand, but limited improvement in end-use consumption, SHFE spot copper quotes against the 2608 contract are expected to remain at a premium today, with the overall center likely moving sideways around current levels.
(2) Guangdong: On July 28, spot #1 copper cathode against the front-month contract in Guangdong was reported at premiums of 70–140 yuan/mt, with an average premium of 105 yuan/mt, up 25 yuan/mt from the previous trading day; SX-EW copper was reported at premiums of 0–20 yuan/mt, with an average premium of 10 yuan/mt, up 20 yuan/mt from the previous trading day. The average price of #1 copper cathode in Guangdong was 105,100 yuan/mt, down 260 yuan/mt from the previous trading day, and the average price of SX-EW copper was 105,005 yuan/mt, down 265 yuan/mt from the previous trading day. Overall, as copper prices pulled back, downstream demand picked up slightly, and suppliers actively held prices firm, resulting in overall trading better than on July 27.
(3) Imported copper: On July 28, the average warrant price fell $1/mt from the previous trading day to $112/mt (range $108–116/mt); average B/L prices fell $1/mt to $107/mt (range $104–110/mt); average EQ copper (CIF B/L) prices fell $1/mt to $75/mt (range $70–80/mt), with quotes referencing cargoes arriving in August.
(4) Secondary copper: On July 28, at 11:30, the futures closing price was 104,990 yuan/mt, down 240 yuan/mt from the previous trading day. Average spot premiums were 275 yuan/mt, down 5 yuan/mt from the previous trading day. Secondary copper raw material prices remained unchanged from the previous trading day. The secondary copper raw material sales sentiment index fell to 2.52, and the procurement sentiment index fell to 2.15. The cathode-scrap price spread was 3,873 yuan/mt, down 240 yuan/mt from the previous trading day. The cathode rod-scrap rod price spread was 1,080 yuan/mt. According to SMM survey, copper prices experienced a slight correction. As premiums stayed high, secondary copper raw material traders faced greater difficulty in selling, and many secondary copper rod enterprises were reluctant to make purchases when premiums were high. The secondary copper raw material market saw mediocre trading during the day.
Prices: On the macro front, although the US-Iran conflict has eased for now, risks of renewed geopolitical conflicts persist. In addition, the market is widely focused on the outcome of Wednesday’s US Fed meeting, with strong wait-and-see sentiment among funds, and copper prices maintained a consolidation pattern. On the fundamentals side, the supply side saw structural divergence: suppliers holding cargoes with invoices dated next month were more willing to sell, leading to relatively ample market availability, while cargoes with invoices dated this month were relatively tight. The demand side benefited from the recent copper price correction, with downstream purchasing interest picking up. Overall, pressured by expectations for US Fed interest rate hikes, copper prices are expected to move sideways to lower in a narrow range today.
[The information provided is for reference only. This article does not constitute direct investment research or decision-making advice. Clients should make decisions prudently and not use this as a substitute for independent judgment. Any decisions made by clients are unrelated to SMM.]