Tuesday, August 11, 2026
Futures: Overnight LME copper opened at $14,122.5/mt, drifted lower to touch $14,069/mt in early trading, then the price center gradually moved up to $14,177/mt, before sliding again to finally settle at $14,120/mt, up 0.7%. Trading volume reached 15,000 lots, open interest 259,000 lots, up 1,164 lots from the previous trading day, driven by increased long positions. Overnight the most-traded SHFE copper 2609 contract opened at 107,850 yuan/mt, drifted lower to 107,450 yuan/mt, then the price center shot straight up to hit 108,060 yuan/mt, and finally closed at 107,790 yuan/mt, up 0.16%. Trading volume was 27,400 lots, open interest 212,000 lots, down 2,287 lots from the previous trading day, driven by reduced short positions.
[SMM Copper Morning Briefing] News:
(1) Cochilco data released on Monday showed that production at Chile's major copper producers mostly increased YoY in June. The Escondida mine, controlled by BHP, produced 111,400 mt, up 45.8% YoY; the Collahuasi large mine, partly owned by Anglo American and Glencore, produced 34,900 mt, up 1.7%. However, state copper giant Codelco's production fell 4.8% to 114,400 mt, according to Cochilco.
Spot:
(1) Shanghai: On August 10, the SHFE copper 2608 contract took an inverted-V shape in morning trading. It opened at 107,570 yuan/mt, then rose steadily to hit a high of 108,000 yuan/mt before pulling back to 107,700 yuan/mt, stabilizing and then edging up to close at 107,770 yuan/mt. The backwardation spread between the front-month and next-month contracts was 240-310 yuan/mt, and the import profit margin for SHFE copper against the 2608 contract ranged from a loss of 1,200 yuan/mt to a loss of 1,090 yuan/mt. The selling sentiment index for copper cathode in Shanghai was 2.71, down 0.48 WoW, and the purchase sentiment index was 2.57, down 0.49 WoW (historical data can be queried in the database). Looking ahead, typhoon weather is expected to disrupt cargo pick-up and transportation at some warehouses in east China, slowing near-term goods flow and providing some support to the spot market. However, intraday market trading was overall sluggish, as weather conditions and high copper prices significantly dampened downstream purchase willingness. Procurement was mostly need-based, and some Zhejiang processing enterprises reduced cargo pick-up trips to Shanghai due to traffic disruptions, limiting demand-side support. On inventories, SMM recorded Shanghai social inventory at 78,300 mt, up 2,200 mt WoW; Jiangsu social inventory at 18,100 mt, down 2,400 mt WoW. Overall east China inventory changes were limited, with no obvious supply pressure yet. Meanwhile, the backwardation spread widened to 240-310 yuan/mt, and the spread between spot and futures expanded, increasing the need for some suppliers to roll positions or liquidate, which could cap spot premiums. In summary, amid the weather-driven logistics disruption, the widening backwardation structure, and sluggish trading, Shanghai spot copper against the 2608 contract is expected to remain in premiums today, but the overall center may fluctuate slightly. Attention should be paid to warehouse pickup and cargo circulation after weather recovers.
(2) Guangdong: On August 10, #1 copper cathode in Guangdong: high-quality copper was quoted at a premium of 100 yuan/mt against the front-month contract, down 60 yuan/mt from the previous trading day; standard-quality copper was at a premium of 0 yuan/mt, down 60 yuan/mt; SX-EW copper was at 0 yuan/mt, down 60 yuan/mt. The average price of #1 copper cathode in Guangdong was 107,945 yuan/mt, down 410 yuan/mt from the previous trading day, and the average price of SX-EW copper was 107,835 yuan/mt, down 410 yuan/mt. The purchase sentiment index in Guangdong was 2.35, up 0.07 from the previous trading day, and the selling sentiment index was 2.88, up 0.03 (historical data can be queried in the database). Overall, with both premiums and copper prices declining, downstream procurement volumes increased, and trading improved.
(3) Imported Copper: On August 10, the average warrant price remained flat from the previous trading day at $101/mt (range $95-107/mt); the average B/L price was also flat at $97/mt (range $90-104/mt); the average price of EQ copper (CIF B/L) was unchanged at $65/mt (range $60-70/mt), with quotes referencing August-September arrivals.
(4) Secondary Copper: On August 10, as of 11:30, futures closed at 107,770 yuan/mt, down 630 yuan/mt from the previous trading day. Spot premiums averaged 80 yuan/mt, up 10 yuan/mt WoW. Secondary copper scrap prices fell by 300 yuan/mt WoW. The selling sentiment index for copper scrap dropped to 2.71, and the purchase sentiment index fell to 1.96. The price spread between copper cathode and copper scrap was 4,404 yuan/mt, down 281 yuan/mt WoW. The price spread between copper cathode rod and secondary copper rod was 1,650 yuan/mt. According to SMM survey, downstream scrap utilization enterprises had used significant funds for raw material procurement and futures in previous arbitrage trades. With copper prices peaking and then pulling back in the short term, these enterprises were waiting to lock in profits on futures, and would not move on spot procurement in the early stages of a copper price retreat. Meanwhile, copper scrap suppliers were eager to sell high-priced inventories, leading to mediocre intraday trading.
Price: On the macro front, Fed official Hammack said multiple rate hikes may be needed to curb inflation, while Trump denied frequent calls with Warsh. In the Middle East, Iran and Oman discussed establishing safe shipping routes without mentioning transit fees; Trump stated the US would seek compensation and include it in negotiations after Iran demanded war reparations; Iran's supreme leader made new appointments, and Trump claimed US forces practically controlled the Strait of Hormuz and cleared mines. Overall, despite recurring Middle East conflicts, reduced expectations for rate hikes lent some bullish support to copper prices. On fundamentals, the supply side saw logistics efficiency drop due to typhoon, with high-quality copper scarce while non-registered copper was relatively ample, keeping overall supply tight but with clear structural divergence among brands. The demand side was suppressed by high copper prices, remaining weak. Overall, the supply-demand tug-of-war persisted. On inventories, as of Monday, August 10, SMM total copper inventory in mainstream regions nationwide fell by 900 mt WoW to 118,000 mt, down 13,600 mt from 131,600 mt in the same period last year. In summary, copper prices are expected to drift higher today.
[The information provided is for reference only; this article does not constitute a direct recommendation for investment research decisions. Clients should make cautious decisions and not replace independent judgment with this. Any decisions made by clients are unrelated to Shanghai Metals Market.]
