Yangshan Copper Premiums Keep Rising in September, SMM Reports

SHANGHAI, Sep. 27 (SMM) – Yangshan copper premiums kept rising momentum since early September, and advanced to $62.5 per tonne on Sep. 26, according to SMM data.

As SMM reported earlier, the rise in Yangshan copper premiums in earlier September was due largely to speeding-up of warrants circulating via dollar-denominated deposit and loan business.

What’s the driving force behind Yangshan copper premiums?

“The recent gain is mainly because of nearing date for signing term contracts in November, and foreign smelters have held back goods to gain the upper hand in November’s negotiation,” SMM copper analyst explains.

According to market sources, Pan Pacific Copper (PPC) and Codelco has offered 2016 term contracts to major Chinese cathode buyers at premiums of $105 and $98 per tonne, respectively. But, SMM learns that deals having been signed are traded below the offers.

Moreover, the expanding of contango on the LME also left cargo-holders in no hurry in sell goods for a better outlook. 

SMM expects Yangshan copper premiums to hold firm for the foreseeable future, and the SHFE/LME copper price ratio and wealth investment products by banks will determine its rising momentum.  

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