Inventory continues to decline, suppliers actively hold prices firm, driving premiums sharply higher [SMM South China spot copper]

SMM, September 18:

Today in Guangdong, spot prices against the front-month contract for #1 copper cathode: high-quality copper was quoted at a premium of 900 yuan/mt, up 200 yuan/mt from the previous trading day; standard-quality copper was quoted at a premium of 700 yuan/mt, up 150 yuan/mt from the previous trading day; SX-EW copper was quoted at a premium of 640 yuan/mt, up 150 yuan/mt from the previous trading day. The average price of #1 copper cathode in Guangdong was 110,255 yuan/mt, up 1,620 yuan/mt from the previous trading day, while the average price of SX-EW copper was 110,095 yuan/mt, up 1,595 yuan/mt from the previous trading day.

Spot market: Guangdong inventory fell for a second consecutive day today, further reducing available supply in the market. As a result, suppliers ignored the sharp rise in copper prices and continued to hold prices firm while selling. In early trading, standard-quality copper was already quoted at a premium of 650 yuan/mt, but it was quickly snapped up. Suppliers continued to adjust prices upward, with premiums rising further to 700 yuan/mt. Even so, supply remained extremely tight in the market. Today, buying sentiment for copper cathode in Guangdong stood at 2.61, up 0.05 from the previous trading day, while selling sentiment was 2.70, down 0.07 from the previous trading day (historical data can be accessed via the database).

Overall, the continuous decline in inventory and active price support by suppliers drove premiums sharply higher.