SHANGHAI, Feb 2 (SMM) - As of Friday February 3, copper stocks in mainstream markets increased by 33,800 mt from Monday to 297,700 mt, and grew by 61,700 mt from Saturday January 28. The inventories increased 101,100 mt from pre-CNY holidays levels and were 86,600 mt above the same period last year. Since the end of December, the domestic copper inventory has increased for six consecutive weeks. The growth is mainly attributable to more shipments from smelters around CNY holidays and inactive downstream purchases. The inventory has increased across China with the total inventory 140,200 mt higher than the 157,500 mt in the same period last year. The inventory was 70,500 mt higher than the same period last year in Shanghai, 24,100 mt higher in Guangdong, and 35,300 mt higher in Jiangsu. The inventory in Zhejiang exceeded the same period last year by 3,600 mt, and that in Tianjin was 3,000 mt higher than the same period last year.
Specifically, the inventory in Shanghai increased by 17,000 mt from Monday to 171,600 mt, and the inventory in Jiangsu increased by 3,000 mt to 51,600 mt. Shipments arrivals of imported cargoes were limited this week, and the stock accumulation was mainly driven by higher shipments from smelters. The smelters in north China delivered cargoes aggressively to east China before delivery of the SHFE front-month copper contract, which is the main cause of the inventory growth in east China. Inventory in Guangdong increased by 9,400 mt to 57,300 mt. The slower downstream replenishment after CNY holidays has resulted in a big growth in inventory, which is reflected in the recent slow growth in the daily average shipments from Guangdong. Overall, the domestic market is in oversupply.
Domestic smelters will contribute to most of the arriving shipments next week as the imports of seaborne cargoes will be limited. Big discounts will fuel the deliveries by smelters. Downstream consumption is expected to gradually recover next week. On the whole, both supply and consumption will pick up next week, and the stock accumulation will be slower than this week.
