Some Warrants Released, Suppliers Actively Sell Off Leading to Premium Decline [SMM SHFE Copper Spot]

Published: Mar 25, 2025 13:53

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[SMM Spot Copper] During the day, mainstream standard-quality copper was quoted at a discount of 40 yuan/mt to 20 yuan/mt against the front-month contract, while high-quality copper was quoted at a discount of 10 yuan/mt to a premium of 10 yuan/mt. Spot trading was quieter than yesterday, although some downstream buyers slightly increased purchases after premiums edged down. However, due to the overall low operating rate, the spot market showed a mediocre performance. The reduction in arrivals and narrowing price spread between futures contracts still prompted suppliers to actively unwind warrants. It is expected that premiums will fluctuate slightly below parity tomorrow.

SMM March 25 News: Spot #1 copper cathode against the current month 2504 contract was quoted at a discount of 40 yuan/mt to a premium of 10 yuan/mt, with an average price at a discount of 15 yuan/mt, down 15 yuan/mt from the previous trading day; standard-quality copper traded at 81,420-81,680 yuan/mt, and high-quality copper traded at 81,450-81,710 yuan/mt. The SHFE copper 2504 contract briefly broke through 82,000 yuan/mt last night, hovering around 81,750 yuan/mt during the first session this morning, and slightly declined in the second session. The price spread between the SHFE copper 2504 and 2505 contracts fluctuated at C20-50 yuan/mt. Due to some warrants being released from positions, spot premiums were under pressure and declined in the early market. At the start of the session, suppliers quoted mainstream standard-quality copper at a discount of 20 yuan/mt to a premium of 10 yuan/mt, and high-quality copper at a discount of 10 yuan/mt to a premium of 20 yuan/mt. As the monthly spread was insufficient to cover funding costs, some traders unwound their positions and sold their warrants, leading to a decline in spot premiums. During the main trading period, mainstream standard-quality copper traded at a discount of 40 yuan/mt to 20 yuan/mt, and high-quality copper traded at a discount of 10 yuan/mt to a premium of 10 yuan/mt. SX-EW copper was quoted at a discount of 80 yuan/mt but was hard to find. Intraday spot trading was quieter than yesterday, although some downstream buyers increased purchases slightly after the premiums edged lower. However, due to the overall low operating rate, the spot market showed mediocre performance. With reduced arrivals and a narrowing monthly spread, suppliers remained active in unwinding their positions. It is expected that premiums will fluctuate slightly below parity tomorrow.

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