Tight Regional Supply and Widening Price Spread Between Futures Contracts Support Shanghai Spot Copper's Shift to Premium [SMM Shanghai Spot Copper]

SMM April 9 update:

During the morning session, the SHFE copper 2604 contract opened with a sharp drop, then stabilized and rebounded before moving sideways in a fluctuating trend. The opening price was 97,930 yuan/mt. After opening, prices weakened and fell, hitting a low of 97,330 yuan/mt. Prices then stabilized and rebounded to 97,590 yuan/mt, before fluctuating between 97,510 yuan/mt and 97,730 yuan/mt, with a closing price of 97,610 yuan/mt. The inter-month price spread between futures contracts was in Contango, ranging from 120 yuan/mt to 30 yuan/mt. The SHFE copper front-month import profit margin ranged from a profit of 80 yuan/mt to a profit of 190 yuan/mt.

Intraday, the selling sentiment for copper cathode in the Shanghai region was 2.67, down 0.04 MoM, and the purchasing sentiment was 2.61, down 0.07 MoM.. At the start of the morning session, suppliers offered standard-quality copper at a discount of 20 yuan/mt to a premium of 10 yuan/mt. Among them, Lufang, JCC, and HMG-B were quoted at a discount of 10 yuan/mt to parity, Zijin at a discount of 10 yuan/mt, and Jinguan, Jinxin, Jintun PC, and Jinfeng at a factory-pickup premium of 20 yuan/mt. Non-registered copper was traded at a discount of 100 yuan/mt. Entering the second trading session, suppliers showed a strong willingness to hold prices firm. Standard-quality copper such as SPCC-ILO and Jinchuan ISA was quoted at a discount of 10 yuan/mt to a premium of 50 yuan/mt. High-quality copper such as Jinchuan (plate), Guixi, and Jintun plate was quoted at a premium of 30 yuan/mt to a premium of 60 yuan/mt. Non-registered copper was quoted at a discount of 100 yuan/mt to a discount of 90 yuan/mt. In addition, available spot cargo in the Jiangsu region remained tight, and some downstream enterprises faced difficulties in purchasing.

Looking ahead to tomorrow, the Shanghai spot copper market is expected to maintain a relatively strong pattern. Regional structure: available spot cargo in the Jiangsu region remains persistently tight, with some downstream enterprises facing difficulties in procurement, providing strong support for spot premiums. Market structure: the inter-month Contango price spread between futures contracts has widened further, strengthening suppliers' willingness to hold positions for delivery under the contango structure, with low willingness to sell at lower prices and strong sentiment to hold prices firm. Demand side, although downstream purchasing has become more cautious following the pullback in copper prices, rigid restocking demand persists. Overall, supported by the combined effects of tight regional supply and the price spread structure, Shanghai spot copper quotes against the 2604 contract are expected to remain at current levels tomorrow.