SMM Copper Demand Surprise Index: China Copper Demand Outperforms Expectation both in June and July 2017

SHANGHAI, Jul. 14 (SMM) – The final SMM Copper Demand Surprise Index (SMMCDSI) was -56.98 in May, and the index was -2.14 in June, better than estimated data. SMM expects the index to come in at 3.52 in July, and market expectation direction changed.

Copper Concentrate Supply Threat Remains, with Spot TCs Unchanged, SMM Reports

Over the past half year, markets had overestimated over copper demand in the peak season after the 2017 Chinese New Year holiday, but changed its mind from June, generally taking a pessimistic outlook for market fundamentals in the second half of the year. The difference between estimated and final reading will offer arbitraging opportunity for the market. (For details, please see SMM Copper Monthly Report)

What’s Outlook for Copper Price This Week? SMM Surveys

The SMM Copper Demand Surprise Index (SMMCDSI) is an objective and quantitative method of evaluation of copper demand in China, and the index is issued around 15 every month, and the issuing date will likely be advanced for business development in the future.

The SMMCDSI index defines the spread between published data of refined copper cathode and scrap copper supply in China, and SMM surveyed and estimated data of domestic copper downstream producers. After normalization, the spread is called the Surprise. When the reading is in positive territory, it indicates that copper demand is above market expectation, and when the reading is above 50, it indicates a high chance for copper futures prices to rise; when the reading is in negative territory, it indicates that copper demand is below market expectation, and when the reading is below -50, it indicates a high chance for copper futures prices to fall. 

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