Post-Holiday Consumption Gradually Recovers, Spot Premiums Bottom Out [SMM South China Copper Cathode Spot Weekly Review]

SMM May 8 update:

Guangdong region: Premiums in this region bottomed out and rebounded this week, mainly because downstream enterprises gradually resumed normal production, inventory shifted from increasing to decreasing, and suppliers held prices firm on shipments. As of Thursday, high-quality copper was quoted at 290 yuan/mt, down 30 yuan/mt WoW; standard-quality copper was quoted at a premium of 220 yuan/mt, down 20 yuan/mt WoW; SX-EW copper was quoted at 150 yuan/mt, down 30 yuan/mt WoW. On Thursday, the price spread of standard-quality copper premiums between Shanghai and Guangdong showed Guangdong higher by 210 yuan/mt, with the spread widening again, drawing attention to whether cross-regional cargo transfers will occur going forward. According to SMM statistics, as of Thursday, total inventory in Guangdong warehouses was 16,300 mt, up 2,600 mt WoW, with warrants totalling 4,500 mt, down 701 mt WoW. Specifically: Weekly warehouse arrivals were 11,900 mt/week, below the annual average (14,000 mt/week); warehouse withdrawals were 11,200 mt/week, below the annual average (14,200 mt/week), showing a pattern of weak supply and demand during the Labour Day holiday.

Looking ahead to next week, arrivals are not expected to increase significantly, but consumption is gradually recovering. Therefore, inventory is expected to remain at low levels, and spot premiums are also expected to stay elevated.

(The above information is derived from market research and comprehensive assessment by the SMM research team. The information provided in this article is for reference only. This article does not constitute direct advice for investment research decisions. Clients should make prudent decisions and not replace independent judgment with this information. Any decisions made by clients are unrelated to SMM.)