Delivery of SHFE copper futures approaching, Shanghai spot copper shifts from premium to discount [SMM Shanghai spot copper]

SMM News on May 12:

        Today, the spot price of SMM #1 copper cathode against the current-month 2505 contract was reported at a discount of 50 yuan/mt to a premium of 20 yuan/mt, with an average price of a discount of 15 yuan/mt, a decrease of 95 yuan/mt from the previous trading day. The SMM #1 copper cathode price ranged from 78,060 to 78,490 yuan/mt. In the early morning session, SHFE copper rose above 78,500 yuan/mt, then declined with reduced positions to a low of 78,100 yuan/mt, before rising to around 78,400 yuan/mt and closing at 78,360 yuan/mt in the morning session. The SHFE copper BACK price spread between futures contracts narrowed from 400 yuan/mt to 300 yuan/mt, and the import loss for the current-month SHFE copper widened to around 640 yuan/mt.

       Selling sentiment diverged during the day, with some enterprises starting to trade at parity in the early session, dragging down the transaction price. Entering the mainstream trading period, the mainstream standard-quality copper gradually declined from a discount of 10 yuan/mt to a discount of 50 yuan/mt. Zhongtiaoshan, Jinguan, etc., traded at around a discount of 50 yuan/mt, while Jinchuan (plate), Guixi, etc., traded near parity. Non-registered supplies traded at around a discount of 100 yuan/mt. As copper prices rose during the day, downstream buyers significantly drove down prices, with transactions occurring at discounts of 140 to 100 yuan/mt.

       As the delivery date approaches, the reduction in positions for the SHFE copper 2505 contract has increased, and the price spread between futures contracts has narrowed. Spot copper is gradually approaching the delivery logic. However, if the discount widens further, the market is expected to exhibit purchase sentiment for delivery purposes.