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This week (May 19-23), the weekly average price range for Yangshan copper premiums B/L transactions was $1,000 to $117.2/mt, with QP June, and the average price was $108.6/mt, down $6.4/mt WoW. Warrant prices ranged from $89.2 to $97.6/mt, with an average price of $93.4/mt, down $6/mt WoW, QP June. EQ copper CIF B/L prices ranged from $72/mt to $82.8/mt, with an average price of $77.4/mt, down $2.6/mt WoW, QP June. As of May 16, the SHFE/LME copper price ratio for the LME copper vs. SHFE copper 2506 contract was 8.1814, with import profit/loss around -700 yuan/mt. As of Friday, LME 3M-Jun copper was in backwardation of $35.15/mt; the spread between June date and July date swap fees was BACK $7.1/mt.
Currently, the actual price for high-quality ER copper warrants is $96/mt, mainstream pyrometallurgical copper is $92/mt, and SX-EW copper is $88/mt. High-quality copper B/L prices are $114/mt, mainstream pyrometallurgical copper is around $104/mt, and SX-EW copper is $94/mt. CIF B/L prices for EQ copper range from $70/mt to $80/mt, with an average price of $75/mt.
At the LME Asian Metals Seminar in Hong Kong this week, the US dollar copper market was relatively sluggish. However, a small number of inquiries, offers, and transaction information still guided spot premiums downward. As LME cancelled warrants are expected to flow out by 50,000-70,000 mt, with an estimated 70% destined for China and 30% for Southeast Asia, suppliers hold a bearish outlook for short-term premiums. However, except for domestic warrant B/Ls, premiums for EQ copper and other registered brands remain relatively firm. Due to the weak performance of the SHFE/LME price ratio, downstream enterprises have poor purchase willingness. Looking ahead, with premiums in Southeast Asia remaining high, a deterioration in the price ratio may attract some domestic smelters to expand their export volumes in June. The balance in the Asian region remains tight before the implementation of the S232 investigation. It is expected that Yangshan copper premiums will continue to decline next week but will rebound after the announcement of June long-term contracts.
According to the SMM survey, as of Thursday (May 22), copper inventories in domestic bonded zones decreased by 8,100 mt from the previous period (May 15) to 60,700 mt. Specifically, bonded copper inventories in Shanghai decreased by 4,800 mt to 53,700 mt, while those in Guangdong decreased by 3,300 mt to 60,700 mt. The main reason for the continuous decline in bonded zone inventories this week is still the inflow of bonded zone inventories attracted by the delivery of the SHFE copper 2505 contract. Looking ahead, with the current weak performance of the import price ratio and the concentrated arrival of imported copper in late May, it is expected that the decline in bonded zone inventories will slow down.
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