BC copper fluctuated within the day and closed up 0.79%, with the price spread between SHFE copper and BC copper remaining inverted [SMM BC Copper Review]

Today, the most-traded BC copper contract opened at 70,160 yuan/mt and closed lower in the day session. During the night session, it dipped to a low of 69,920 yuan/mt before fluctuating considerably upward. After the day session opened, the price center gradually rose as bulls increased positions, touching a high of 70,690 yuan/mt before fluctuating downward. It rebounded near the close and finally settled at 70,490 yuan/mt, up 550 yuan/mt (0.79%). Open interest reached 3,755 lots, up 847 lots from the previous trading day. Trading volume stood at 4,869 lots, up 1,854 lots from the previous session. On the macro front, Waller publicly supported a 25-basis-point interest rate cut by the US Fed in September and projected further cuts within the next three to six months, fueling short-term rate cut expectations. The US dollar index remained in the doldrums, supporting copper prices. Japan continued urging the US to implement the tariff reduction agreement reached in late July, which the US has yet to fulfill. Coupled with the impending US tax on small parcels, tariff policy uncertainty weighed on copper prices. Supply side, social inventories at domestic mainstream warehouses increased 4,100 mt MoM to 127,100 mt. Demand side, traders and downstream buyers showed stronger purchasing sentiment due to copper scrap supply deficits.

SHFE copper 2510 contract settled at 79,410 yuan/mt. Based on the BC copper 2509 contract's price of 70,490 yuan/mt (post-tax equivalent: 79,654 yuan/mt), the price spread between SHFE copper 2510 and BC copper contracts maintained an inverted structure at -244 yuan/mt.