Large price spread between futures contracts on delivery day; spot trades sluggish [SMM South China spot copper]

SMM, September 15:

Today in Guangdong, spot prices of #1 copper cathode against the front-month contract: high-quality copper was quoted at a premium of 0 yuan/mt, down 100 yuan/mt from the previous trading day; standard-quality copper was quoted at a discount of 100 yuan/mt, down 50 yuan/mt from the previous trading day; SX-EW copper was quoted at a discount of 160 yuan/mt, down 50 yuan/mt from the previous trading day. The average price of #1 copper cathode in Guangdong was 107,445 yuan/mt, down 1,465 yuan/mt from the previous trading day, and the average price of SX-EW copper was 107,335 yuan/mt, down 1,430 yuan/mt from the previous trading day.

Spot market: Guangdong inventory edged down, mainly due to reduced arrivals. Although copper prices declined, downstream enterprises showed weak purchasing interest because today was the delivery day and the price spread between futures contracts was very wide. Suppliers had to lower premiums to sell, and ultimately the front-month standard-quality copper traded at a discount of 100 yuan/mt. In addition, the next-month standard-quality copper was quoted at a premium of 600 yuan/mt. Today, the purchasing sentiment for copper cathode in Guangdong was 2.43, down 0.14 from the previous trading day, and the shipment sentiment was 2.70, down 0.12 from the previous trading day (historical data can be queried in the database).

Overall, on the delivery day, the price spread between futures contracts was wide and spot trades were sluggish. It is expected to improve tomorrow.