SHANGHAI, Aug. 20 (SMM) – Copper stocks on the hand of Chinese traders rose in July, matching SMM prediction. But the inventories are expected to fall back in August.
July witnessed a large inflow of imported copper into Chinese market on favorable SHFE/LME copper price ratio, especially in the latter half of the month. As a result, inventories in bonded areas fell.
Nevertheless, these goods entering Chinese market were not immediately consumed during this slack season, driving a noticeable rise in inventories in Shanghai and Guangdong.
“The devaluating Chinese yuan pushed up the copper price ratio, but also increased costs of copper financing, which will negatively affect copper imports, so we expect copper inventories to decline in August,” SMM analyst says.
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