Premiums of Yangshan Copper Continued to Fall amid Import Losses

SHANGHAI, Feb 15 (SMM)- Yangshan copper premiums averaged $33.5/mt under warrants in January, down $20.39/mt MoM; and $24.38/mt under bill of lading, down $22.8/mt MoM. Entering February, the import losses reached 500-700 yuan/mt as SHFE/LME copper price ratio has not been significantly repaired. Coupled with slow recovery of post-holiday demand and financial pressure, large-sized traders sharply lowered the Yangshan copper premiums to dump goods for cash. In addition, the export profits have driven some smelters to ship their cargoes to the bonded zone since mid-February, which intensified inventory pressure in the bonded zone. On the whole, the oversupply in the foreign trade market has curbed the upside trend of premiums. However, it is worth noting that the naoshima smelter (with a capacity of 225,000 mt) of PPC will carry out maintenance from February 7 to March 15. At present, the major domestic companies that have signed long-term orders with PPC have not received notices for delivery delays. But this new may promote traders to restock and provide upside momentum for the premiums.