SMM, December 26:
Guangdong Region: This week, premiums in the region showed a continuous upward trend, mainly due to record-low inventory levels and suppliers standing firm on quotes. As of Thursday, high-quality copper was quoted at a premium of 350 yuan/mt, up 160 yuan/mt WoW; standard-quality copper at a premium of 300 yuan/mt, up 160 yuan/mt WoW; and hydro copper at a premium of 240 yuan/mt, up 150 yuan/mt WoW. On Thursday, the price spread of standard-quality copper premiums between Shanghai and Guangdong was 290 yuan/mt higher in Guangdong. Despite the significant price spread between the two regions, there were no cross-regional transfers due to year-end financial constraints faced by enterprises. According to SMM statistics, as of Thursday, total inventory in Guangdong stood at 3,800 mt, marking a new low for the year and a decrease of 3,404 mt WoW. Specifically, this week’s arrivals were 10,400 mt/week, down slightly by 752 mt WoW and below the annual average level (14,000 mt/week). Outflows from warehouses were 13,600 mt/week, up 1,300 mt WoW but slightly below the annual average level (14,200 mt/week). Currently, downstream consumption remains moderate, and with limited direct shipments, warehouse outflows have managed to stay near the annual average level. Looking ahead to next week, as year-end approaches, smelters are expected to face inventory clearance pressure, leading to a significant increase in arrivals. On the demand side, we understand that many copper rod enterprises will implement production cuts next week. Therefore, we anticipate a scenario of increased supply and weakened demand next week, with weekly inventory likely to rise again.
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