SHANGHAI, Mar. 11 (SMM) –
According to China Customs, China's scrap copper imports during February were 300,000 mt, down 21.1% MoM and 25.5% YoY. Negatively affected by the Chinese New Year holiday, scrap copper imports fell appreciably in February, but as the SHFE/LME copper price ratio improves and copper futures prices stabilize at lows, scrap copper imports are increasing again. SMM predicts scrap copper imports will likely hit 450,000 mt in March.
Unwrought Copper and Copper Semis
According to China Customs, China's imports of unwrought copper and copper semis during February were 298,000 mt, down 15.1% MoM and 38.5% YoY. Imports during January and February totaled 649,000 mt, down 27.8% YoY. February imports fell below 300,000 mt for the first time in 19 months, and due mainly to two factors. First, during February, most traders began executing 2013 long-term imported copper contracts, but the number of these contracts decreased. Second, the number of working days in February was down due to the Chinese New Year holiday. It is worth noting, however, that the post-holiday SHFE/LME copper price ratio improved, so losses for imported copper shrank to RMB 1,500/mt in late February, down from RMB 2,500/mt earlier in the month, and with losses have even falling below RMB 1,000/mt during March. The narrowing losses enticed copper consumers to enter markets, but copper stocks at Chinese bonded zones were still considered high and failed to decrease significantly after the Chinese New Year holiday. Against this backdrop, supply pressure will remain for the foreseeable future and continue to weigh on copper prices despite declining copper imports.