Teck's Production Expansion Delay and Weak U.S. Employment Data Weighed on LME Copper, Which Pulled Back Under Pressure Overnight [SMM Copper Morning Meeting Summary]

Friday, September 5, 2025
Futures: Overnight, LME copper opened at $9,910/mt, fluctuated downward initially to a low of $9,875/mt, then the center of copper prices gradually moved upward to a high of $9,932.5/mt, before fluctuating downward to close at $9,891.5/mt, down 0.83%, with trading volume at 14,000 lots and open interest at 286,000 lots. Overnight, the most-traded SHFE copper 2510 contract opened at 79,680 yuan/mt, fluctuated upward initially to a high of 79,880 yuan/mt, then fluctuated considerably with the center of copper prices gradually moving downward to a low of 79,620 yuan/mt during the session, and finally closed at 79,650 yuan/mt, down 0.41%, with trading volume at 17,000 lots and open interest at 182,000 lots.
[SMM Copper Morning Meeting Summary] News:
(1) On September 3, 2025, Teck Resources announced that it would postpone approval of a major expansion project until operational reviews are completed and production issues at the Quebrada Blanca (QB) copper mine in Chile are resolved. The QB project previously faced cost overruns of approximately $4 billion, construction delays, and technical challenges, leading to lower-than-expected production. In July, Teck had already lowered its 2025 copper production guidance to 210,000–230,000 mt, with the main bottlenecks being tailings management and discharge issues. The company stated that the operational review is expected to be completed in October, and further updates will be provided in subsequent financial reports.
Spot:
(1) Shanghai: On September 4, SMM #1 copper cathode spot prices against the front-month 2509 contract were reported at a premium of 60–300 yuan/mt, with the average price quoted at a premium of 180 yuan/mt, down 10 yuan/mt from the previous trading day; SMM #1 copper cathode prices ranged from 79,950 to 80,430 yuan/mt. In the morning session, SHFE copper fell continuously from around 80,210 yuan/mt, touching 79,720 yuan/mt near the close of the morning session; the inter-month price spread was BACK 20–40 yuan/mt, and import losses for front-month SHFE copper remained between 300–400 yuan/mt. Looking ahead to today, copper prices around 80,000 yuan/mt are suppressing downstream purchases, but with tomorrow being Friday, downstream stocking sentiment is expected to rise, likely limiting the extent of the premium decline.
(2) Guangdong: On September 4, Guangdong #1 copper cathode spot prices against the front-month contract were reported at 0–70 yuan/mt premium, with the average premium at 35 yuan/mt, down 5 yuan/mt from the previous trading day; SX-EW copper was reported at a discount of 80–60 yuan/mt, with the average discount at 70 yuan/mt, down 10 yuan/mt from the previous trading day. The average price of Guangdong #1 copper cathode was 80,055 yuan/mt, down 470 yuan/mt from the previous trading day, while the average price of SX-EW copper was 79,950 yuan/mt, down 475 yuan/mt. Overall, as copper prices fell, downstream enterprises increased restocking, and spot trades improved.
(3) Imported copper: On September 4, warrant prices were $51–63/mt, QP September, with the average price up $1 from the previous trading day; B/L prices were $53–67/mt, QP October, with the average price up $2/mt from the previous trading day; EQ copper (CIF B/L) was $27–35/mt, QP October, with the average price up $1/mt from the previous trading day. Quotations refer to cargoes arriving in mid-to-late September.
(4) Secondary copper: At 11:30 on September 4, the futures closing price was 79,810 yuan/mt, up 260 yuan/mt from the previous trading day. The average spot premiums/discounts were 180 yuan/mt, down 10 yuan/mt from the previous trading day. Today, the price of recycled copper raw materials fell 200 yuan/mt MoM. The price of bare bright copper in Guangdong was 73,600-73,600 yuan/mt, down 200 yuan/mt from the previous trading day. The price difference between copper cathode and copper scrap was 1,763 yuan/mt, down 177 yuan/mt MoM. The price difference between copper cathode rod and secondary copper rod was 1,000 yuan/mt. According to the SMM survey, some scrap utilization enterprises in Jiangxi issued price adjustment notices this week, stating that due to the impact of national fair competition policies, they will lower the pricing coefficients for copper-containing materials. The pricing coefficients for metals such as copper, silver, and palladium were reduced from 93.5% to 90%, while the coefficient for gold remains unchanged.
(5) Inventory: On September 3, LME copper cathode inventories decreased by 200 mt to 158,375 mt; on September 4, SHFE warrant inventories increased by 358 mt to 19,829 mt.

Price: On the macro front, although the US ADP employment data for August fell short of expectations and initial jobless claims rose, indicating signs of weakness in the labour market, market attention was highly focused on the upcoming US non-farm payrolls data. Cautious wait-and-see sentiment drove the US dollar index higher, putting pressure on copper prices. On the fundamentals side, the supply side saw a large arrival of imported copper, while domestic supply was limited, resulting in overall loose market supply. On the demand side, consumption was suppressed by high copper prices, and downstream purchase willingness was weak. As of September 4, SMM copper inventories in mainstream regions across China increased by 8,500 mt WoW to 140,600 mt. Price-wise, considering both macro and fundamental factors, copper prices encountered resistance today.

[The information provided is for reference only. This article does not constitute direct investment research advice. Clients should make decisions cautiously and not use this to replace independent judgment. Any decisions made by clients are unrelated to SMM.]