China Imports of Unwrought Copper and Copper Semis Fall 19.9% YoY, Why? SMM Reports

SHANGHAI, Apr. 14 (SMM) – Inbound shipments of unwrought copper and copper semis to China were 1.15 million tonnes during the first three months of 2017, down 19.9 percent on a yearly basis, China Customs data showed.

Imports were 430,000 mt in March, up 26.5 percent, and down 24.56 percent, on a monthly and yearly basis, respectively. 

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SMM attributes the year-on-year decline in imports during the Jan.-Mar. period to following reasons.

First, the profitable import window had closed for copper products during the first three months of 2017, and the window opened in January 2016 for importers, who took the chance to import large amounts of products. In March 2016, the imports reached 570,000 tonnes, a record high. The opening of profitable import window during the same period of 2016 led to high base in comparison on a yearly basis.

Second, the average utilization rate at domestic copper processing enterprises fell during the first three months of 2017 on a yearly basis, SMM survey finds, also reducing demand for imports.

The closing of profitable import window caused most of imported resources to be piled up in bonded area in Jan.-Mar. 2017, a big difference from the condition during the same period last year when most of goods flew into domestic market after customs clearance thanks to opening of the window.

According to SMM data, copper inventories in Shanghai bonded area in the week ending Apr. 7 were 654,000 tonnes, up 184,000 tonnes from the level seen in the week ending Dec. 30, 2016.

Recently, the profitable window has opened occasionally, but domestic market reports no arrivals of imported copper in large amounts, according to SMM sources. The drop of copper inventories in Shanghai bonded area will be small in the short term, SMM predicts.

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