As of Monday February 13, copper stocks in mainstream markets tracked by SMM increased by 3,400 mt to 316,300 mt compared with Friday February 10. The gradual recovery of consumption and the limited arrivals of imported copper reduces the accumulation of stocks. At present, the total inventory has increased by 119,700 mt compared with 196,600 mt before Chinese New Year holidays. Over the weekend, inventories grew across major regions except for Shanghai. Inventories in Shanghai decreased by 1,400 mt to 185,200 mt, and inventories in Guangdong increased by 2,800 mt to 58,300 mt. Those in Chongqing increased by 2,000 mt to 10,000 mt.
Consumption in Shanghai picked up. Meanwhile, smelters refrained from shipping cargoes to warehouses given spot premiums, resulting in the decline in arriving s shipments in Shanghai. Smelters around Guangdong increased shipments, but downstream stockpiling was moderate. After active production last week, finished product inventories at some enterprises have accumulated. And the operating rate has dropped compared with last week. This can also be reflected in the decline in daily average shipments.
This week, the market shall pay attention to the recovery of downstream consumption. We believe that if copper prices do not continue to decline, the enthusiasm for downstream replenishment will further increase, and the inventory accumulation will further decrease.
