Shipments decreased on the last trading day before the holiday, pushing up SHFE copper spot premiums [SMM Shanghai spot copper]

SMM News on May 30:

       Today, the spot prices of SMM #1 copper cathode against the May 2506 contract were reported at a premium of 120-220 yuan/mt, with an average premium of 170 yuan/mt, unchanged from the previous trading day. The SMM #1 copper cathode price range was 78,380-78,590 yuan/mt. In the morning session, the SHFE copper 2506 contract continued to decline to around 78,000 yuan/mt, briefly returning to 78,100 yuan/mt near 11 a.m. The BACK price spread between futures contracts for the next month widened slightly to 360 yuan/mt during the day, and the import loss for the current month's SHFE copper narrowed to around 900 yuan/mt.

       As today is the last trading day of May, most enterprises are not engaging in trading, and there are fewer sellers. Spot quotes have risen, forcing downstream buyers with just-in-time procurement needs to accept higher premiums. However, in the Changzhou area, cargo sources similar to those from Yuguang, Zhongjin, and Tiefeng did not command high premiums, with prices almost unchanged from yesterday's procurement levels. Due to tight SX-EW copper supplies, some non-registered cargo sources were traded at a premium of 30 yuan/mt during the day.

       Looking ahead after the holiday, inventory is expected to build up due to import arrivals. Downstream raw material inventories are not expected to be significantly depleted after the holiday, and procurement sentiment is anticipated to remain low. There is still a possibility that spot premiums for SHFE copper will be suppressed.