Argentina Expected to Export Over $20 Billion in Copper Over the Next Decade, LME Copper Closed Sharply Higher Overnight [SMM Copper Morning Meeting Minutes]

2026.5.7 Thursday
Futures: Overnight LME copper opened at $13,400.5/mt, touched a high of $13,462/mt early in the session before the center fluctuated downward, dipped to $13,328/mt before the center moved upward, and ultimately moved sideways to close at $13,391.5/mt, up 2.22%, with trading volume at 27,000 lots and open interest at 268,000 lots, up 1,485 lots from the previous trading day, indicating bullish position building. Overnight the most-traded SHFE copper 2606 contract opened at 103,350 yuan/mt, touched a high of 103,370 yuan/mt immediately after opening, then the center dipped to 102,850 yuan/mt before staying high and moving sideways in a narrow range, ultimately closing at 103,160 yuan/mt, up 0.49%, with trading volume at 36,000 lots and open interest at 199,000 lots, down 185 lots from the previous trading day, mainly indicating bearish position reduction.
[SMM Copper Morning Meeting Summary] News:
(1) On May 6 (Wednesday), Argentina's Mining Minister Luis Lucero said in an interview that the country expects lithium export value to reach $12.1 billion and copper export value to reach $20.6 billion over the next decade. Lucero added that mining projects approved or submitted under the country's Large Investment Incentive Regime (RIGI) totaled $50.692 billion in value. The RIGI regime, launched under President Javier Milei's initiative, has helped Argentina attract investments from mining giants such as BHP and Rio Tinto. The Argentine government aims to make mining a key industry alongside energy and agriculture. Roberto Cacciola, president of Argentina's Mining Chamber, said earlier this week that Argentina's mining exports are growing at an accelerating pace and are expected to jump 49% in 2026.
Spot:
(1) Shanghai: On May 6, the SHFE copper 2605 contract showed a gap-up opening followed by a sustained upward trend in early trading. The opening price was 101,100 yuan/mt, after which prices jumped to 102,160 yuan/mt, then edged down to a low of 101,860 yuan/mt, before stabilizing and rising to a closing price of 102,680 yuan/mt. The inter-month Contango price spread ranged between 90 yuan/mt and 30 yuan/mt, and the SHFE copper import profit margin against the 2605 contract for the current month ranged between a profit of 110 yuan/mt and a profit of 240 yuan/mt. Looking ahead, inventory side, SMM data showed that post-holiday social inventory in the Shanghai area was recorded at 188,300 mt, up 6,500 mt MoM, while inventory in the Jiangsu area was 41,700 mt, down 1,000 mt MoM. The destocking trend in social inventory saw its first inflection point, shifting to a slight inventory buildup during the holiday period, though the increase was not yet significant, and attention should be paid to the sustainability of subsequent inventory buildup. Supply side, although the import window maintained profitability, logistics disruptions in Africa led to reduced import arrivals, limiting short-term incremental spot supply. Demand side, after copper prices rose, end-user purchase willingness weakened, coupled with suppliers holding back from selling, spot premiums rose, and market trading was thin on both sides. Overall, under the multiple factors of high prices suppressing demand, the initial appearance of an inventory inflection point, suppliers holding back from selling, and reduced import arrivals, Shanghai spot copper premiums against the 2605 contract are expected to remain at a premium today.
(2) Guangdong: On May 6, spot #1 copper cathode against the front-month contract in Guangdong: high-quality copper was quoted at 270 yuan/mt, down 40 yuan/mt from the previous trading day; standard-quality copper was quoted at a premium of 180 yuan/mt, down 50 yuan/mt from the previous day; SX-EW copper was quoted at a premium of 120 yuan/mt, down 50 yuan/mt from the previous day. The average price of #1 copper cathode in Guangdong was 102,550 yuan/mt, up 975 yuan/mt from the previous trading day; the average price of SX-EW copper was 102,445 yuan/mt, up 970 yuan/mt from the previous trading day. Overall, as copper prices rose, suppliers lowered premiums to facilitate shipments, and trading activity was mediocre.
(3) Imported copper: On May 6, the average warrant price rose $5/mt from the previous trading day to $69/mt (price range: $62-76/mt); the average B/L price rose $5/mt from the previous trading day to $66/mt (price range: $61-73/mt); the average EQ copper (CIF B/L) price rose $5/mt from the previous trading day to $36/mt (price range: $30-42/mt), with quotes referencing cargoes arriving in early to mid-May.
(4) Secondary copper: On May 6, the futures closing price at 11:30 was 102,680 yuan/mt, up 1,380 yuan/mt from the previous trading day. The average spot premium was 100 yuan/mt, up 40 yuan/mt from the previous trading day. On May 6, copper scrap prices rose 600 yuan/mt MoM. The copper scrap sales sentiment index rose to 2.49, and the purchase sentiment index rose to 2.22. The price difference between copper cathode and copper scrap was 1,774 yuan/mt, up 749 yuan/mt MoM. The price difference between copper cathode rod and secondary copper rod was 1,360 yuan/mt. According to an SMM survey, copper prices surged after the holiday, and secondary copper rod enterprises showed lukewarm purchase willingness. Although elevated copper prices incentivized copper scrap suppliers to ship, downstream uptake was mediocre, and intraday market trading was mediocre.
Prices: Macro perspective, US media reported that the US and Iran are expected to first end hostilities before initiating a 30-day negotiation cycle. Trump signaled optimism about reaching a deal, easing geopolitical risk-aversion sentiment. Additionally, the Japanese yen appreciated significantly, with the market expecting Japan to conduct foreign exchange intervention, jointly pushing the US dollar index lower and providing bullish support for copper prices. On the fundamentals side, supply side, imported and domestically produced copper cargoes arrived successively, with overall supply marginally loosening. Demand side, downstream resumption of operations was slow-paced, and overall purchase willingness remained mediocre. Inventory side, as of Wednesday, May 6, copper inventories in major regions nationwide per SMM increased by 9,900 mt WoW from pre-holiday levels to 252,900 mt. Overall, copper prices are expected to show a narrow-range fluctuating trend that holds up well today.
[The information provided 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 not related to SMM.]