March 22 (Bloomberg) -- Refined copper imports by China, the world's largest consumer of the metal used in homes and power grids, gained 12 percent in February from a month earlier as demand improved and scrap supplies remained low.
Inbound shipments of refined copper were 220,530 metric tons last month, the Beijing-based customs office said today. That's an increase of 12 percent from January and 19 percent lower than the same month last year, according to data compiled by Bloomberg.
Chinese after-tax copper prices have traded at a premium to those in London for most of this year, according to Bloomberg calculations. The premium stood at around 67 yuan a ton at 9:50 a.m. Shanghai time today, down from this year's high of about 3,000 yuan in February.
The increase in imports is "no surprise given the favorable arbitrage," Ji Guoqin, an analyst at Zhejiang Zhongda Futures Co. said from Hangzhou. "A continuing shortage of scrap meant more demand for the refined metal," he said.
China imported 276,634 tons of scrap copper in February, customs said today, down from 337,443 tons a month earlier.
Arbitrage is where investors attempt to profit from price disparities for the same asset in different markets.
The June-delivery contract on the Shanghai Futures Exchange declined 0.6 percent to 59,850 yuan ($8,767) a ton at 9:29 a.m. local time. Copper for three-month delivery on the London Metal Exchange gained 0.4 percent to $7,465 a ton at the same time.