[SMM Price] April 7 copper spot discount in Shanghai market (first period)

According to SMM statistics, as of July 16, social inventories of copper cathode in major Chinese regions fell to 123,400 mt, down by 16,600 mt from July 13. The recent destocking was mainly due to unplanned maintenance at some smelters, reduced domestic arrivals, and the diversion of overseas supply to the US market, while imported copper remained limited. In the secondary copper market, substitution of copper cathode was weak owing to compliance reviews on invoices. Although demand entered the traditional off-season, with downstream users making just-in-time procurement, the larger contraction in supply is expected to keep inventories low in the short term. Notably, the ratio of cancelled warrants in LME copper inventories has continued to rise recently, and some of the cancelled material has been arranged for shipment to China, indicating that low domestic inventories and tight spot supply are gradually attracting overseas material back. While demand is in the off-season and downstream users are making just-in-time procurement, the supply contraction has been more significant, and inventories are expected to remain low in the short term.

SMM News: Spot supply in Shandong remains tight. Coupled with continuous destocking of copper cathode social inventory, the average spot copper price in Shandong stays high.