SHANGHAI, May 6 (SMM) - SMM data showed that copper inventories across mainstream areas in China increased 9,400 mt from last Friday April 29 to 120,000 mt as of Friday May 6. Compared with the data last Friday, the inventory in most regions of China this week increased, while the inventories in Chengdu and Tianjin dropped slightly. The total inventory fell 221,900 mt from the same period last year when the inventory was recorded 341,900 mt. According to SMM research, the operating rates of most downstream enterprises in various regions of the country during the Labour Day holiday this year were not as high as that of the same period last year as many manufacturers had a longer holiday. SMM believes that there are two reasons which contributed to the increase in inventory after the holiday that was less than expected. First, many smelters directly shipped goods to downstream. Second, many copper cathode stagnated at plants due to the transportation problem.
In detail, the inventories in Shanghai increased 4,300 mt to 83,200 mt, the inventories in Guangdong rose 3,400 mt to 26,800 mt, the inventory in Jiangsu added 2,000 mt to 7,100 mt, the inventory in Chongqing rose 200 mt to 1,100 mt, and the inventory in Tianjin dipped 400 mt to 500 mt. Stimulated by the maintenance of smelters in the north and the downstream consumption, the inventory in Tianjin has been decreasing recently.
Looking forward, with the sharp drop in copper prices after the holiday, downstream consumption is gradually improving. In addition, most downstream copper enterprises did not purchase any goods before the Labour Day holiday, so SMM expects that these companies will increase their purchasing volume next week, and the weekly inventory will drop again.
The above representation and data is based on market information SMM believes to be reliable at the time of acquiring as well as the comprehensive assessment by SMM research team, and any and all information provided in this article is for reference only. This article does not constitute a direct recommendation for investment or any decisions in any form and clients shall act on their own discreet and any decisions made by clients are not within the responsibility of SMM.