As of Monday, October 28, SMM copper inventories in major regions nationwide decreased by 9,500 mt compared to last Thursday, reaching 210,100 mt. However, total inventories were 151,200 mt higher compared to 58,900 mt in the same period last year, with Shanghai up 113,700 mt, Guangdong by 23,100 mt, and Jiangsu by 13,200 mt.
Specifically, inventories in Shanghai decreased by 2,100 mt compared to last Thursday, reaching 154,400 mt, and Jiangsu inventories decreased by 1,400 mt to 17,800 mt. Although consumption in Shanghai and Jiangsu was moderate, the inflow of imported copper limited the decline in inventories. Guangdong inventories decreased by 5,700 mt to 32,900 mt. Recently, both domestic and imported copper arrivals in Guangdong have been relatively low, while consumption has improved, as reflected by the high daily outflows from warehouses.
Looking ahead, domestic copper production is expected to decrease due to smelter maintenance, but the arrival of imported copper is expected to increase due to environmental protection measures, leading to a slight increase in total supply compared to last week. On the demand side, end-of-month downstream consumption has declined. According to our survey, the weekly operating rate of copper cathode rod producers is expected to drop to 76.09% this week, down 0.43 percentage points compared to last week. Therefore, we expect an increase in supply and a decrease in demand this week, with weekly inventories likely to increase slightly.
