This week (September 7-September 11), the weekly average transaction price range for Yangshan copper premium warrants was $74-85/mt, QP September, with an average price of $79/mt; the weekly average transaction price range for B/L was $75-85/mt, QP October, with an average price of $85/mt; EQ copper CIF B/L was $46-59/mt, QP October, with an average price of $52/mt. As of September 7, the SHFE/LME copper price ratio for LME copper against the SHFE copper 2610 contract, excluding exchange rates, was 1.1342, with an import loss of approximately 368.3 yuan/mt, nearly flat WoW. As of Friday, the backwardation structure of the LME copper October date contract narrowed WoW, and the September date and October date contracts shifted to a contango structure, with a carry spread of $47.06/mt. Currently, offers for pyrometallurgy registered copper B/L are scarce in the market; mainstream offers for pyrometallurgy registered copper warrants are around $110-120/mt; mainstream offers for EQ copper are around $50-70/mt.
During the week, imported copper premiums showed a trend of first declining and then rebounding. As copper prices rose and shot up, the SHFE/LME price ratio continued to deteriorate, downstream demand remained weak, and the LME backwardation structure narrowed, with the September date contract shifting to a contango structure, putting spot premiums for imported copper under pressure. However, the market reversed on Friday, with copper prices plunging and the SHFE/LME price ratio improving significantly, boosting downstream demand. Meanwhile, persistent congestion at domestic ports and low domestic inventories limited available supply in the market, giving suppliers strong confidence to hold prices firm, and offers in the market rose notably on Friday.
According to SMM, as of Thursday this week (September 10), copper inventories in domestic bonded zones decreased by approximately 1,800 mt from the previous period (September 3) to 38,800 mt. Among them, Shanghai bonded zone inventory decreased by 2,400 mt to 35,700 mt, while Guangdong bonded zone inventory increased by 600 mt to 3,100 mt. Shanghai bonded zone inventory shifted from inventory buildup to destocking, mainly due to logistics delays and a poor SHFE/LME price ratio leading to lower arrivals.
Looking ahead, downstream demand is expected to continue recovering after copper prices weaken, the LME backwardation structure is narrowing, and domestic social inventories of copper cathode remain low with port congestion persisting, so the SHFE/LME price ratio is expected to continue rebounding. In the short term, available spot supply of imported registered copper remains tight, which will give suppliers confidence to hold prices firm, and imported spot premiums are expected to have upside room next week.
