Summary of Market Fluctuations in Imported Copper During the Week [SMM Analysis]

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At the beginning of 2025, the global copper market experienced multiple anomalies. As the LME February delivery date approached, a large number of bears shifted positions from February contracts to March contracts, causing the price spread between LME February and March contracts to plummet from a contango structure of approximately $36/mt on February 13 to nearly $0/mt, essentially flattening. Meanwhile, copper prices on COMEX, LME, and SHFE all rose, further widening the import losses for the SHFE copper 2502 contract.

Since late January 2025, geopolitical conflicts erupted in eastern DRC, with the anti-government armed group "M23 Movement" launching offensives in North Kivu Province and taking control of Goma, resulting in approximately 3,000 deaths. A temporary ceasefire was reached on February 12. According to SMM, although the conflict is about 1,500 kilometers away from major copper mining areas, local smelters reported that production and copper cathode transportation have not been significantly affected. Currently, DRC's annual copper cathode production accounts for about 10% of the global total, and production is expected to continue increasing in 2025.

As of the close on February 14, the import profits for SHFE copper 2502 and 2503 contracts compared to LME fell to approximately -1,000 yuan/mt and -700 yuan/mt, respectively, indicating that the export window is about to open. However, major domestic smelters reported that due to the significant volatility of the LME 3M contract, it is currently difficult to determine the extent and duration of the export window, and there are no clear plans to increase exports to bonded warehouses or LME Asian warehouses. Major bonded zone warehouses also stated that they have not yet received significant new transfer-to-delivery warehouse requests.