SHANGHAI, Apr. 18 (SMM) – Copper inventories on the SHFE were down 28,983 tonnes to 331,942 tonnes in the week ending Apr. 15, down for four weeks in a row.
Will falling SHFE copper inventories give a support to copper prices?
“Copper prices will still come under pressures as China’s copper inventories, including SHFE warehouses and bonded area, remain largely unchanged,” SMM copper analyst points out.
According to SHFE data, the bourse’s copper inventories were down by a total of 62,835 tonnes from Mar. 18 to Apr. 15, while copper stocks were up by around 60,000 tonnes to approximately 550,000 tonnes in bonded area during the same period.
Then, is there any connection of inventory change between the two?
The increase in bonded area, should be the result of high imports in March, not shift of inventories from SHFE warehouses, in addition to exports under tolling trade by some smelters.
“The decline in SHFE copper inventories is due mainly to the close of import window, falling supply from unit maintenance or production cuts, and copper reserves, as well as demand improvement,” SMM explains.
The SHFE/LME copper price ratio had been unfavorable for imports since the end of January, and import losses briefly expanded to 1,600 yuan per tonne, according to SMM data, closing the window for imports.
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