Demand Gradually Recovers, Spot Premiums Steadily Rise, but High Inventory Still Limits the Increase [SMM South China Spot Copper]

Published: Feb 07, 2025 11:37 (GMT+8)

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SMM, February 7: Today, spot #1 copper cathode in Guangdong was quoted at a discount of 270 yuan/mt to parity against the front-month contract, with an average discount of 135 yuan/mt, up 30 yuan/mt from the previous trading day. Hydro copper was quoted at a discount of 340-300 yuan/mt, with an average discount of 320 yuan/mt, up 50 yuan/mt from the previous trading day. The average price of #1 copper cathode in Guangdong was 76,375 yuan/mt, up 365 yuan/mt from the previous trading day, while the average price of hydro copper was 76,190 yuan/mt, up 385 yuan/mt.

Spot market: Guangdong inventory has risen for 14 consecutive days, but the growth has slowed due to fewer outflows from warehouses and increased arrivals. As downstream enterprises gradually resume operations, demand has been increasing, driving up spot premiums. Additionally, some warehouses still have available storage capacity, leading to higher transaction prices for deliverable cargoes. As of 11:00 a.m., high-quality copper was quoted at parity against the front-month contract, standard-quality copper at a discount of 270 yuan/mt, and hydro copper at a discount of 320 yuan/mt. We expect spot premiums to continue rising in the future.

Overall, demand is gradually recovering, and spot premiums are steadily increasing, but high inventory levels continue to limit the upward momentum.

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