Blocked Imports Combined with China Maintenance Support Post-Holiday SHFE Copper Spot Premiums [SMM Shanghai Spot Copper]

SMM April 30:

During the morning session, SHFE copper 2605 contract showed a "W" pattern. Opening price was 101,160 yuan/mt, after which prices dipped slightly to a low of 101,040 yuan/mt, then rose continuously to a high of 101,450 yuan/mt, before retreating to 101,150 yuan/mt and stabilizing with a rebound, closing at 101,300 yuan/mt. The inter-month Contango price spread between futures contracts ranged from 60 yuan/mt to 10 yuan/mt, and the import profit margin for SHFE copper against the 2605 contract was between a profit of 80 yuan/mt and 160 yuan/mt.

Intraday, copper cathode trading sentiment in Shanghai rebounded. Selling sentiment was 2.66, up 0.07 MoM, and purchasing sentiment was 2.71, up 0.13 MoM. Historical data can be found in the database. At the start of the morning session, suppliers offered standard-quality copper including Lufang, JCC, and Xiangguang with cargoes with invoices dated next month at premiums of 40-50 yuan/mt, while Zhongtiaoshan cargoes with invoices dated this month were quickly traded at a premium of 90 yuan/mt. High-quality copper from Guiye was offered with next-month invoices at a premium of 150 yuan/mt. In the second trading period, low-priced cargoes were hard to find. Jinguan, Jintun PC, Jinfeng, Jinxin and other brands offered cargoes with invoices dated this month at ex-factory premiums of 80-100 yuan/mt. High-quality copper Jintun large cathodes were offered at an ex-factory premium of 150 yuan/mt for cargoes with invoices dated this month. Registered SX-EW copper was scarce, with only some SPENCE circulating, offered at a premium of 10 yuan/mt for cargoes with invoices dated next month.

Post-holiday outlook: Demand side, enterprises are expected to mainly make just-in-time procurement, and demand is unlikely to see a significant increase after the holiday. Additionally, some downstream processing enterprises prefer to purchase directly from smelters to ensure invoice compliance, diverting some spot demand from the trading market. Supply side, first, diesel shortages in Africa have caused hindered transportation, delaying the arrival pace of imported copper at ports, resulting in tight imported copper supply in the short term. Second, according to SMM, five domestic smelters are expected to undergo maintenance in May, which will also reduce domestic spot circulation. Overall, against the backdrop of tightened spot circulation due to hindered imports and domestic maintenance, suppliers have a strong willingness to hold prices firm, and Shanghai spot copper premiums are expected to hold up well after the holiday.