SMM review of spot copper market in Shandong

Last week, spot quotes in Shandong opened high but trended lower in the first half of the week. The performance stabilized in the second half, with spot premiums standing at 10 yuan/mt by last Friday. The increased purchasing activity from downstream buyers after the SHFE front-month copper contract delivery contributed to the initially high spot premiums. However, according to feedback from large smelters, orders from downstream factories remained limited, resulting in more supply flowing into traders and weak end-user demand.

Downstream processing companies focused on replenishing their inventories at lower prices. In the latter half of the week, as spot premiums were relatively low, sellers were reluctant to further reduce prices. Additionally, some downstream enterprises replenished their inventories for the weekend. As a result, spot premiums remained stable.

This week, downstream purchasing demand is expected to weaken as the end of the month approaches. If the copper price remains relatively high, it is anticipated that spot premiums in Shandong will have difficulty rebounding.