The US is expected to impose additional import tariffs on copper soon, and copper prices are in the doldrums [SMM Copper Morning Meeting Summary]

Futures Market: Overnight LME copper opened at $9,610.5/mt, briefly dipped to $9,601/mt in early trading before fluctuating upward to hit $9,673/mt. Subsequently, copper prices gradually pulled back and closed at $9,660/mt, down 0.05%, with trading volume at 38,000 lots and open interest reaching 279,000 lots. Overnight SHFE copper opened at 78,340 yuan/mt, immediately surged to 78,530 yuan/mt, then fluctuated downward to touch 78,160 yuan/mt before partially rebounding to close at 78,330 yuan/mt, down 0.74%, with trading volume at 35,000 lots and open interest at 190,000 lots.

[SMM Morning Copper Meeting Summary] News: (1) Trump first announced tariffs on six countries. According to CCTV News, Trump posted letters to Brunei, Algeria, Moldova, Iraq, the Philippines, and Libya on his social media platform on July 9 local time. CCTV reported that the US will impose 25% tariffs on Brunei and Moldova, 30% on Algeria, Iraq, and Libya, and 20% on the Philippines starting August 1, 2025. Subsequently, Trump published a tax letter to Sri Lanka on social media, stating 30% tariffs on Sri Lankan products will take effect August 1.

(2) US Commerce Secretary Howard Lutnick told CNBC that a US delegation is expected to meet with Chinese officials next month for trade consultations. Lutnick disclosed the delegation will also include Treasury Secretary Scott Bessent and US Trade Representative Jamieson Greer.

Spot Market: (1) Shanghai: On July 9, SMM #1 copper cathode spot premiums against the July 2025 contract were reported at 20-120 yuan/mt, with an average premium of 70 yuan/mt, down 15 yuan/mt from the previous trading day. Looking ahead, downstream buying sentiment remains bearish, limiting procurement demand. With widening month-on-month spreads, downstream buyers are expected to continue bargaining down purchasing prices, keeping spot premiums under pressure today.

(2) Guangdong: On July 9, Guangdong #1 copper cathode spot prices against the front-month contract ranged from a discount of 110 yuan/mt to a premium of 50 yuan/mt, averaging a 30 yuan/mt discount, up 20 yuan/mt MoM. Overall, trading activity improved from the previous session as lower copper prices spurred restocking interest among consumers.

(3) Imported Copper: On July 9, warrant prices stood at $20-38/mt for July QP, averaging $1/mt lower MoM; B/L prices reached $46-80/mt for August QP, averaging $11/mt higher MoM; EQ copper (CIF B/L) was quoted at $0-20/mt for July QP, averaging $12/mt higher MoM, with pricing references for mid-to-late July arrival cargoes. Overall market turnover was basically flat WoW, but activity among traders increased.

(4) Secondary copper: On July 9, secondary copper raw material prices fell 200 yuan/mt MoM. Guangdong bare bright copper prices stood at 73,200-73,400 yuan/mt, down 200 yuan/mt from the previous trading day. The copper cathode-scrap price difference was 1,031 yuan/mt, narrowing 613 yuan/mt MoM, while the copper cathode rod-secondary rod price spread was 865 yuan/mt. According to SMM survey, copper prices initially pulled back sharply due to Trump's proposed 50% tariff on copper imports, but domestic secondary copper raw material suppliers still refused to budge on prices. Many secondary copper rod enterprises reported that downstream clients primarily inquired about prices yesterday rather than executing actual transactions, so they were not rushing to procure secondary copper raw materials to ensure production.

(5) Inventories: On July 9, LME copper inventories rose 4,625 mt to 107,125 mt; SHFE warrant inventories increased 2,227 mt to 21,336 mt on the same day.

Price: Overnight SHFE copper opened at 78,340 yuan/mt, surging to 78,530 yuan/mt in early trading before fluctuating downward to hit a low of 78,160 yuan/mt. Prices partially rebounded toward the close, settling at 78,330 yuan/mt with a 0.74% loss. Trading volume reached 35,000 lots, and open interest stood at 190,000 lots. On the macro front, Trump issued tariff letters to eight countries including Brazil (potential 50% tariff) and reiterated on social media plans to impose a 50% tariff on imported copper effective August 1, 2025. Higher copper tariffs would ease spot copper market conditions in non-US regions, exerting downward pressure on prices. Meanwhile, the US Fed's June minutes revealed policymaker divisions over tariff-driven inflation risks, ruling out a July interest rate cut. This policy uncertainty weighed on risk appetite, collectively pressuring copper prices. Fundamentally, yesterday's intraday price decline stimulated modest downstream buying the dip, though turnover only marginally recovered. However, most downstream users remain cautious, adopting a wait-and-see stance amid bearish price expectations. Synthesizing these factors, the macro landscape faces trade flow adjustments from elevated tariffs and policy uncertainty from shifting Fed expectations. Fundamentals show improved supply from potential cargo diversions, yet high prices and bearish sentiment continue to suppress downstream demand, creating a "loosening supply outlook versus weak actual demand" dynamic. Copper prices are expected to encounter resistance today.

[The information provided is for reference only and does not constitute direct investment advice. Clients should exercise independent judgment, and any decisions made are not endorsed by SMM.]

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[The above information is based on market collection and comprehensive assessments by SMM's research team, provided for reference purposes only. This article does not constitute direct advice for investment research and decision-making. Clients should make cautious decisions and should not replace their independent judgment with this. Any decisions made by clients are not related to SMM.】