Copper inventories in Jiangsu unexpectedly fell 6,000 mt on week

SHANGHAI, Feb 28 (SMM) – Social inventories of copper cathode across Shanghai, Guangdong and Jiangsu stood at 503,700 mt as of February 28, up 45,700 mt, or 10% from a week earlier and up 288,700 mt over the five weeks from January 23, showed SMM data.

The increase in overall copper inventories continued to slow this week, with stocks in Jiangsu unexpectedly falling 6,000 mt as local copper processing companies restarted operations successively. Lower copper prices boosted restocking by downstream consumers in Jiangsu, who purchased the nearest available sources given the existing trans-provincial shipment curbs. This also accounted for the decline in copper stocks in Jiangsu this week. 

While more producers returned from holidays, the recovery of demand remained sluggish on the back of manpower and logistics issues amid a coronavirus outbreak. The latest SMM survey indicated that 90% of companies across the copper industry chain have resumed operations, but the capacity utilisation rates are only half of the normal levels. 

Subdued downstream demand resulted in muted trades in the spot copper market, which saw the discounts for spot products staying above 100 yuan/mt, against the SHFE March contract, this week.