Standard-Quality Copper Supply Is Scarce, Premiums Rise Sharply, But Actual Transactions Are Weak [SMM South China Spot Copper]

SMM, January 9:

Today, spot #1 copper cathode in Guangdong was quoted at a premium of 480-500 yuan/mt against the front-month contract, with an average premium of 490 yuan/mt, up 90 yuan/mt from the previous trading day. Hydro copper was quoted at a premium of 330-350 yuan/mt, with an average premium of 340 yuan/mt, up 20 yuan/mt from the previous trading day. The average price of #1 copper cathode in Guangdong was 75,165 yuan/mt, up 315 yuan/mt from the previous trading day, while the average price of hydro copper was 75,015 yuan/mt, up 245 yuan/mt from the previous trading day.

Spot market: Guangdong inventory increased for the second consecutive day, but the growth was limited today, and the total inventory remained at a historically low level. Due to the extremely limited circulating inventory of standard-quality copper, suppliers continued to stand firm on quotes, causing premiums to surge. However, as imported copper arrived and the price spread between hydro copper and standard-quality copper widened, along with the continuous decline in hydro copper prices, the rise in standard-quality copper premiums was somewhat constrained. As of 11:00 am, premiums for high-quality copper against the front-month contract were quoted at 500 yuan/mt, standard-quality copper at 480 yuan/mt, and hydro copper at a premium of 300 yuan/mt.

Overall, the limited availability of standard-quality copper led to a significant increase in premiums, but actual transactions were weak. Attention should be paid to the impact of imported copper on the market.

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