Profit Window for Import Opens, Why China’s Imported Unwrought Copper Drops Dramactically?

SHANGHAI, Nov.8 (SMM)－As per Customs data, China’s imported volume of unwrought copper and copper material in October drops to lowest level since April, because the price surges to the highest level during past three year. Imported volume of copper ore and its concentrates also declines.

China’s imported volume of unwrought copper and copper material in October is 330,000 tonnes, higher than 290,000 tonnes of same time last year but lower than 430,000 tonnes in September.

Imported volume of unwrought copper and copper material from January to October is 3.76 million tonnes, dropping 7.8% on yearly basis.

Imported volume of copper ore and its concentrates in October is 1.37 million tonnes, setting new low since May.

Reasons for drop of imported unwrought copper and copper material

With regard to profit balance, since September profit window has been open and surges in end of October. But why this did not stimulate increase of import?

SMM thinks, on one hand, since the National Day Holiday is longer than previous years this year, domestic enterprises had completed import by September. On the other hand, SMM learned that due to enhanced supervision on domestic credit, line of credit of some large-scale enterprises are shrinking.

Liu Peng, from Luzheng Futures, says drop of imported copper and its concentrates volume is an ordinary phenomenon. Downstream demand has been over drafted in advance. With demand being lowering, enterprises are purchasing as per needs and consume own inventories. With high operating rate of domestic smelting plants as well as the scrap copper issue, copper usage is enlarged after price difference between concentrates and scrap rises. Domestic market is impacted by enterprises with import right of scrap copper. Although drop of imported volume of unwrought copper and copper material in October is more than anticipation, it has not been beyond expectation.

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