BC copper jumped initially and then pulled back during the night session, with the price spread inversion narrowing [SMM BC Copper Commentary]

Today, the most-traded BC copper 2508 contract opened at 69,880 yuan/mt, closing the day with a positive candlestick. During the night session, the most-traded BC copper contract fluctuated upward at the beginning, touching an intraday high of 69,970 yuan/mt. Subsequently, the center of copper prices gradually moved lower. During the day session, after opening, prices continued to decline amid fluctuations, approaching the end of the session, prices dropped to 69,560 yuan/mt, and finally closed at 69,600 yuan/mt, with a gain of 0.06%. Open interest reached 4,298 lots, a decrease of 166 lots from the previous trading day, and trading volume reached 4,554 lots. On the macro side, San Francisco Fed President Mary Daly reiterated that an interest rate cut might be initiated in the fall, with two cuts expected this year, strengthening the US Fed's easing expectations. Chile, a major copper-producing country, is seeking exemption from US copper tariffs. Currently, there are no significant new macro variables, and the market's core focus is on whether the 50% copper tariff will be implemented. If successfully exempted, it will alleviate market concerns about high tariffs. On the fundamental side, as of Thursday, July 10, SMM's nationwide mainstream copper inventories increased slightly by 800 mt from Monday to 143,700 mt, an increase of 11,900 mt from last Thursday. Weekly inventories have been building up for two consecutive weeks and are 244,900 mt lower than the same period last year, with inventories still running at low levels. On the demand side, due to the copper price correction in the previous two days, purchasing sentiment has slightly recovered.

The SHFE copper 2508 contract closed at 78,430 yuan/mt. If based on the most-traded BC copper 2508 contract price of 69,600 yuan/mt, its after-tax price would be 78,648 yuan/mt. The price spread between the SHFE copper 2508 contract and the BC copper contract is -218, maintaining an inversion and narrowing compared to the previous day.