Entering the New Year, Premiums Rose Sharply but Market Acceptance Was Low [SMM SHFE Spot Copper]

SMM News on December 31:

Today, spot #1 copper cathode was quoted at a premium of 70-120 yuan/mt against the SHFE 2501 contract, with an average premium of 95 yuan/mt, up 115 yuan/mt from the previous trading day. Standard-quality copper traded at 73,350-73,500 yuan/mt, while high-quality copper traded at 73,370-73,520 yuan/mt. The SHFE copper 2501 contract opened lower last night but rebounded during the morning session. It initially rose from 73,130 yuan/mt to around 73,350 yuan/mt. The price spread between the SHFE copper 2501 and 2502 contracts fluctuated between a contango of 20 yuan/mt and a backwardation of 20 yuan/mt.

Entering 2025, premiums rose significantly, with market quotes moving downwards after a higher opening in the morning. Initially, mainstream standard-quality copper was quoted at a premium of 90-110 yuan/mt, while high-quality copper, such as CCC-P and Jinchuan (plate), was quoted at a premium of 100-130 yuan/mt with limited transactions. Entering the new year, traders showed strong restocking demand, but their willingness to trade was weak due to high premiums, while downstream buying interest remained moderate. Subsequently, market offers pulled back. During the main trading session, mainstream standard-quality copper traded at a premium of 80-90 yuan/mt, and high-quality copper traded at a premium of 90-110 yuan/mt with some transactions. The arrivals of imported copper remained abundant, exerting pressure on market prices. By 11:00 a.m., mainstream standard-quality copper traded at a premium of 70-80 yuan/mt, while high-quality copper quotes remained firm.

According to the SMM survey, the Shanghai region saw a slight inventory buildup this week, mainly due to increased arrivals of imported copper. In the short term, premiums may rise due to some traders' restocking activities, but downstream consumption has gradually weakened. Premiums are expected to edge lower tomorrow.