Significant Increase in Copper Rod Export Prices: Will Ordinary Trade Quotations Cease? [SMM Analysis]

The export tax rebate policy stipulated in Announcement No. 15 of 2024 by the Ministry of Finance and the State Administration of Taxation is expected to be officially implemented on December 1. According to an SMM survey conducted two weeks before the official implementation, the processing fees for copper cathode rod exports (FOB) have significantly increased. Is this due to a rise in import profit/loss or a change in policy? The following is a detailed analysis.

According to SMM statistics, during the week of November 22, the lowest processing fee for 8mm copper cathode rod exports (FOB) was recorded at $154/mt, remaining unchanged WoW. The highest price was recorded at $218/mt, up $20/mt WoW. The average processing fees for 8mm copper cathode rod exports (FOB) increased by $10/mt, reaching $186/mt. The lowest processing fee for 2.6mm copper cathode rod exports (FOB) was recorded at $194/mt, remaining unchanged WoW. The highest price was recorded at $258/mt, up $20/mt WoW. The average processing fees for 2.6mm copper cathode rod exports (FOB) ultimately increased by $10/mt.

During the week of November 22, the lowest processing fee for copper cathode rod exports remained unchanged, mainly because some enterprises temporarily maintained their original quotation model under ordinary trade before the cancellation of the tax rebate policy. Additionally, due to direct exports by physical enterprises and adjustments in Yangshan copper premiums, the low price remained unchanged. However, major export enterprises in the market had already ceased quotations under ordinary trade last week. In the future, except for the long-term contracts not yet completed this year, all other orders will be converted to processing trade. Currently, quotations have been made for the model of processing with imported materials. Additionally, the rise in import profit/loss has also supported the current export prices for copper wire rod, leading to a significant increase in the high-end processing fees for copper cathode rod exports during the week.

According to an SMM survey, major enterprises exporting copper wire rod plan to switch all current ordinary trade orders to processing trade in 2025. Whether the total export volume will significantly shrink in the future depends on the signing of export long-term contracts. SMM will continue to monitor this for you.