SHANGHAI, Jun. 24 (SMM) – Spot premiums to SHFE 1507 copper contract in China’s markets have expanded to more than 200 yuan, helping bolster SHFE copper prices. Will this high spot premium give sustainable support to SHFE copper?
“SHFE copper will take some impetus from the large spot premiums, but such situation may prove unsustainable given weak actual consumption in the offseason and limited money supply for companies at mid-year,” said analyst of Maike Futures.
“The current high premium was mainly a result of cargo holders unwilling to sell, but the premiums are unlikely to hold high for long unless stimulus measures are taken or the State Reserve Bureau begins stockpiling,” analyst of Dayou Futures told SMM.
Western Futures’ analyst believed that demand should remain the key factor influencing prices, so any price hike will be short-lived without robust consumption.