Significant Inventory Buildup After the Holiday, Yet Contango Widens as Suppliers Stand Firm on Quotes [SMM Shanghai Spot Copper Weekly Review]

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       After only two trading days following the Chinese New Year holiday, Shanghai spot copper premiums remained firm. According to SMM data, during the holiday, the inventory of copper cathode in major warehouses in Shanghai increased by 51,100 mt to 155,500 mt. Despite the significant inventory increase, downstream raw material inventory had not been fully digested after the holiday, and rising copper prices suppressed consumption, leading copper cathode suppliers to stand firm on quotes. Although there is still one week before the delivery of the SHFE copper February 2502 contract, SHFE copper futures warehouse warrants have already shown a significant increase. On February 6, the Contango structure of SHFE copper for the next month continued to expand, widening to 190 yuan/mt at the close. SHFE copper futures warehouse warrants increased by 20,268 mt to 46,727 mt. It is expected that next week, with relatively sluggish downstream consumption, suppliers will still maintain a firm stance on quotes, and spot cargo is unlikely to show significant discounts as delivery approaches.

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