Domestic demand is cold before the holiday, which is expected to drag down copper prices to a certain extent.

Published: Feb 08, 2024 23:01 (GMT+8)

Source: SMM

Save

News: (1) Federal Reserve officials hawkish, hinting at a slowdown in the pace of interest rate cuts, the number of dollar rate cuts is expected to be reduced to 2-3, and U.S. Treasury yields are higher. (2) In 2023, all the projects for the issuance of additional treasury bonds of 1 trillion yuan will be completed, mainly including the post-disaster recovery and reconstruction of North China with the focus on the Beijing-Tianjin-Wing and the improvement of disaster prevention and mitigation capabilities, the project of improving the emergency response capacity of natural disasters, and the construction of a comprehensive prevention and control system for key natural disasters.
Spot: (1) Shanghai: On February 7, 1# electrolytic copper reported a discount of 30 yuan/ton - a premium of 20 yuan/ton for the 2402 contract of the month, and the average price was quoted at a discount of 5 yuan/ton, down 25 yuan/ton from the previous month. Today is the last trading day before the Spring Festival, and the spot market is expected to remain cold, and the price of the holder may provide guidance for the premium after the year, and the premium is expected to stabilize and operate.
(2) Guangdong: On February 7, the spot price of Guangdong 1# electrolytic copper was quoted at a premium of 0 yuan/ton - a premium of 50 yuan/ton for the current month, with an average premium of 25 yuan/ton, which was flat month-on-month. Overall, the market is cold and the pre-holiday atmosphere is strong, and there are only sporadic purchases.
(3) Imported copper: the warehouse receipt price on February 7 was 43-55 US dollars/ton, and in QP February, the average price fell by 1 US dollar/ton month-on-month; The bill of lading price was 40-55 US dollars / ton, QP March, the average price was flat month-on-month; EQ copper (CIF bill of lading) 4-8 US dollars / ton, QP March, the average price is flat month-on-month, and the quotation refers to the supply of goods arriving in Hong Kong in mid-February and late February. Yesterday, the two brands were still reported at 75 US dollars / ton, and the wet process was reported at 60 US dollars / ton, overseas consumption continued to be weak, and the LME spot showed a historic discount, which undoubtedly gave the holders confidence in the price. However, most traders in the market have started the holiday mode, and it is difficult to smell the real deal.
(4) Recycled copper: On February 7, the price of bright copper in Guangdong was 62,600-62,800 yuan/ton, unchanged from the previous month, the price difference of refined waste was 1,496 yuan/ton, down 55 yuan/ton from the previous month, and the price difference of refined waste rod was 405 yuan/ton. According to SMM research, the operating rate of recycled copper rods this week was only 4.3%, and only individual enterprises were left to produce until February 6, after which all sample enterprises began to take holidays.
(5) Inventory: LME copper inventory decreased by 950 tons to 137,850 tons on February 7; On February 7, the inventory of warehouse receipts on the Shanghai Futures Exchange increased by 3,537 tons to 38,219 tons.
Prices: On the macro front, copper prices came under pressure due to the slightly higher dollar index and the sluggish domestic consumption before the Chinese New Year. In terms of fundamentals, from the perspective of consumption, on the last trading day before the Spring Festival, most companies have entered the Spring Festival holiday, and there is almost no transaction in the market. On the whole, the supply side remains loose, and the state of "price but no market" continues. In terms of prices, on the whole, domestic demand is cold before the holiday, which is expected to drag down copper prices to a certain extent.

copper price Copper

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or for more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

4 hours ago

China's Refined Copper Output Growth Expected to Slow Sharply in 2026 Amid Feedstock Constraints

China's refined copper production growth is expected to slow sharply in 2026 as smelters face tightening copper concentrate and scrap availability alongside weaker sulphuric acid prices, according to foreign media reports. Wood Mackenzie and Zijin Tianfeng Futures expect China's refined copper output to increase by around 3–3.4% in 2026, compared with growth of 10.4% in 2025. Reuters said this would represent the slowest annual growth rate since at least 2000 based on its review of official production data. Refined copper output growth stood at approximately 4% year on year during January-August. The slowdown is expected to become more pronounced in the fourth quarter as tighter scrap copper supply adds to the existing shortage of copper concentrate. Reuters reported that a tax crackdown is expected to reduce scrap availability, further limiting smelters' ability to substitute secondary raw materials for concentrate when feedstock conditions tighten. Smelter economics have also come under pressure from lower sulphuric acid prices. Sulphuric acid, a major by-product of copper smelting, had previously helped offset extremely low copper concentrate treatment charges. According to Oilchem data cited by Reuters, Chinese sulphuric acid prices declined by around 11% during September. Seven Chinese copper smelters are reportedly planning equipment maintenance lasting between 30 and 60 days during October and November. Analysts at Zhuochuang estimate that the planned maintenance could reduce refined copper supply by approximately 80,000 mt. The concentrate shortage reflects a broader imbalance between rapidly expanding global smelting capacity and comparatively slower growth in mined copper supply. Recent temporary disruptions at major copper mines including Escondida, Las Bambas and El Teniente have added further pressure to concentrate availability. Slower refined copper production growth in China could reduce refined copper supply growth during the fourth quarter, particularly if planned smelter maintenance coincides with continued constraints in concentrate and scrap availability. The simultaneous decline in sulphuric acid prices is also weakening an important source of smelter revenue at a time when treatment charges remain under pressure. Attention will therefore remain on concentrate availability, scrap supply conditions and the scale of planned smelter maintenance during October and November.

4 hours ago

Eldorado Gold Completes Skouries Grid Energization Ahead of Q4 Commercial Production

Eldorado Gold has completed the permanent grid connection and energization of its Skouries copper-gold mine in northern Greece, marking another key commissioning milestone as the project advances toward commercial production expected in the fourth quarter of 2026. The site was successfully energized following final inspection, testing and approval by the Greek transmission authority. Eldorado said the permanent connection to the national grid provides the long-term power infrastructure required to support continued commissioning and ramp-up of processing and mining systems across the operation. The milestone follows the recent achievement of first copper-gold concentrate production at Skouries on September 8. The company is now progressing commissioning and ramp-up activities as it moves toward steady-state operations and commercial production later this year. Skouries is a copper-gold operation being developed using a combination of conventional open-pit and underground mining methods. Based on the company's current mine plan, the operation is expected to produce an average of approximately 67 million lb, or around 30,400 mt, of copper per year over its mine life, alongside approximately 140,000 oz/year of gold. The permanent grid connection is particularly important for the operation of major process systems, including crushing, grinding, flotation, concentrate handling and tailings disposal, which require full site energization as commissioning advances. Completion of permanent grid energization removes an important infrastructure constraint at Skouries and supports the continued ramp-up of the project following first concentrate production earlier in September. With commercial production still targeted for Q4 2026, attention will now turn to the pace of commissioning and the transition toward steady-state operations. Once fully ramped up, Skouries is expected to become a meaningful new source of European copper supply, with average annual copper production of approximately 30,400 mt over the mine life.

4 hours ago

Centinela Copper Mine Workers Approve Strike as Labour Talks Move to Mediation

Workers represented by two unions at Antofagasta Minerals' Centinela copper mine in northern Chile have voted overwhelmingly in favour of strike action after rejecting the company's latest collective bargaining offer. According to foreign media reports, 98.73% of union members voted in favour of a strike, with all eligible members participating in the vote. The Minera Esperanza and Distrito Centinela unions had previously urged their members to reject the company's proposal amid disagreements over employee benefits. The unions have argued that Antofagasta Minerals has declined to discuss equalising benefits for workers regardless of their union affiliation. Antofagasta Minerals does not comment on its ongoing collective bargaining negotiations. Despite the vote, a strike has not yet begun. The company and unions must now enter a mandatory five-day government-led mediation process before workers can legally begin strike action. The mediation period can be extended by another five days if both sides agree. Centinela is a major copper operation in Chile and produced 240,400 mt of copper in 2025. The outcome of the mediation process will therefore be closely watched for any potential impact on operations and copper supply. The 98.73% vote in favour of strike action represents an escalation in the labour negotiations at Centinela, but there has been no reported disruption to copper production at this stage. The mandatory mediation period provides an opportunity for the company and unions to reach an agreement before industrial action begins. Given Centinela's 2025 copper production of 240,400 mt, an extended work stoppage could create additional supply uncertainty, although the scale of any potential production impact cannot be estimated unless a strike begins and its duration becomes clearer.

4 hours ago