Spot copper premiums dipped amid holiday-thinned trading

SHANGHAI, Apr 29 (SMM) – Transactions of spot copper cathode were subdued in Shanghai on the morning of April 29, two days before the five-day Labour Day holiday, as pre-holiday risk aversion kept traders from aggressively purchasing and downstream consumers mostly finished stockpiling. This saw spot copper premiums dipping to almost 100 yuan/mt.  

A rebound in Shanghai copper futures grew cash-in inclination of cargo holders, and this also accelerated the decline in copper premiums. After the market opened this morning, premiums fell quickly from 140 yuan/mt to 110-120 yuan/mt, against the SHFE May contract. Trades mostly occurred between premiums of 110-130 yuan/mt, and the price spread between different brands was limited. 

Copper cathode sellers showed no inclination to cut premiums below 100 yuan/mt, while some importers actively destocked low-end copper products, which weighed premiums of hydro-copper to 60-80 yuan/mt. 

SMM expects spot trades to further cool on Thursday as the market anticipates a large amount of imported copper to arrive at warehouses during the upcoming holiday. 

The SHFE May copper contract recovered losses from Tuesday, returning above 42,700 yuan/mt and ending the Wednesday morning trading hours 0.76% higher on the day at 42,680 yuan/mt. 
As of noon on April 29, trades of high-grade copper occurred at 42,790-42,860 yuan/mt with standard-quality copper trading at 42,780-42,850 yuan/mt.