Spot premiums fell slightly on the first day of August, while supplier sentiment improved [SMM Shanghai spot copper]

SMM News on August 1:

       Today, the spot prices of SMM #1 copper cathode against the August 2508 contract were reported at premiums of 130-220 yuan/mt, with an average premium of 175 yuan/mt, a decrease of 5 yuan/mt from the previous trading day. The SMM #1 copper cathode price ranged from 78,240 to 78,420 yuan/mt. In the early morning session, the futures market briefly surged to 78,220 yuan/mt before starting to decline, touching a low of 78,100 yuan/mt in the morning, then rising to around 78,200 yuan/mt, and closing near 78,300 yuan/mt in the morning session. The price spread between futures contracts for different months remained at a small BACK of 10-20 yuan/mt.

       Today marks the first trading day of August, with both purchasing and selling sentiments in the spot market improving. The purchasing sentiment for Shanghai copper cathode was 3.11, and the selling sentiment was 3.16. Coinciding with Friday, downstream enterprises stockpiled for the weekend, engaging in bargain down purchasing prices, leading to a slight decline in spot premiums today. However, the overall domestic spot supply has been insufficient recently, and with the BACK spread between months only at 10-20 yuan/mt, suppliers have a low willingness to significantly lower their quotes. A small amount of cargo from Jinchuan and Guixi, with premiums above 200 yuan/mt, was sold at 160 yuan/mt. Other transactions, such as those from Xiangguang, Lufang, and JCC, were concluded at premiums of 130-170 yuan/mt. In the early morning session, cargo from Jinchuan Yongchang, Dajiang pc, etc., was traded at premiums of 100-110 yuan/mt.

       Looking ahead to next week, copper prices ranging from 78,000 to 78,500 yuan/mt are unlikely to attract significant downstream purchasing, and it is expected that spot premiums will struggle to rise. However, it should be noted that the recent fluctuations in the bill space have been substantial, potentially affecting the circulation of spot cargo. Attention should be paid to suppliers' reluctance to budge on prices.