Japan, the West, and South Korea Report Continued Decline in TC/RC, LME Copper Slightly Lower Overnight [SMM Copper Morning Meeting Minutes]

Friday, October 17, 2025
Futures: LME copper opened overnight at $10,560.5/mt, touched a low of $10,490/mt early in the session, then the center of copper prices rose all the way and touched a high of $10,659.5/mt near the end of the session, finally closing at $10,620/mt, up 0.42%, with trading volume reaching 20,000 lots and open interest reaching 320,000 lots. The most-traded SHFE copper contract 2512 opened overnight at 84,530 yuan/mt, touched a low of 84,510 yuan/mt early in the session, then fluctuated upward and touched a high of 85,430 yuan/mt, finally closing at 85,140 yuan/mt, up 0.09%, with trading volume reaching 55,000 lots and open interest reaching 216,000 lots.
[SMM Copper Morning Meeting Minutes] News:
(1) On October 15, Japan, Spain, and South Korea jointly issued a warning: the sharp decline in copper concentrate treatment and refining charges (TC/RC) currently threatens the sustainability of the mining and smelting industry chain. The three countries stated that due to tight concentrate supply and the expansion of Chinese smelting capacity, some Chinese smelters even process copper concentrates "free of charge," dragging global rates to extreme levels. The joint statement pointed out that if this trend continues, it will force some smelting enterprises to scale back or exit business, impacting the stability of the copper industry chain.
Spot:
(1) Shanghai: On October 16, SMM #1 copper cathode spot prices against the front-month 2511 contract were quoted at parity to a premium of 120 yuan/mt, with the average price quoted at a premium of 60 yuan/mt, down 60 yuan/mt from the previous trading day; SMM #1 copper cathode prices were 84,900–85,450 yuan/mt. In the morning session, SHFE copper first fell then rose, initially declining from 85,130 yuan/mt to 84,980 yuan/mt, then returning above 85,300 yuan/mt. The inter-month price spread fluctuated between a contango of 50 yuan/mt and a contango of 20 yuan/mt, and the import loss for SHFE copper narrowed to within 1,000 yuan/mt. Looking ahead to tomorrow, Friday, downstream stockpiling sentiment is expected to increase, but with copper prices currently fluctuating around 85,000 yuan/mt, buying interest is expected to be difficult to significantly lift, and spot copper trading in Shanghai is expected to be flat compared with today.
(2) Guangdong: On October 16, Guangdong #1 copper cathode spot prices against the front-month contract were at a premium of 20–80 yuan/mt, with the average premium at 50 yuan/mt, up 10 yuan/mt from the previous trading day; SX-EW copper was quoted at a discount of 40–20 yuan/mt, with the average discount at 30 yuan/mt, up 10 yuan/mt from the previous trading day. The average price of Guangdong #1 copper cathode was 85,115 yuan/mt, down 100 yuan/mt from the previous trading day, and the average price of SX-EW copper was 85,035 yuan/mt, down 100 yuan/mt from the previous trading day. Overall, spot trades improved after delivery, and the premium rose slightly.
(3) Imported copper: On October 16, warrant prices were $40–50/mt, QP October, with the average price flat from the previous trading day; bill of lading prices were $40–64/mt, QP November, with the average price flat from the previous trading day; EQ copper (CIF bill of lading) was $12–20/mt, QP November, with the average price flat from the previous trading day. Quotations refer to cargoes arriving in mid-to-late October.
(4) Secondary copper: At 11:30 on October 16, the futures closing price was 85,170 yuan/mt, up 90 yuan/mt from the previous trading day; the average spot premium/discount was 60 yuan/mt, down 30 yuan/mt from the previous trading day. Today, the price of recycled copper raw materials rose 200 yuan/mt MoM. The price of bare bright copper in Guangdong was 77,200-77,400 yuan/mt, up 200 yuan/mt from the previous trading day. The price difference between copper cathode and copper scrap was 2,996 yuan/mt, down 153 yuan/mt MoM. The price difference between copper cathode rod and secondary copper rod was 1,700 yuan/mt. According to the SMM survey, as copper price trends moderated, purchasing sentiment among downstream wire and cable enterprises reignited, and secondary copper rod enterprises reported moderate transaction volumes.
(5) Inventory: On October 15, LME copper cathode inventory decreased by 900 mt to 137,450 mt; on October 16, SHFE warrant inventory decreased by 125 mt to 44,406 mt.
Price: On the macro front, several US Fed officials laid the groundwork for further interest rate cuts, coupled with the ongoing US government shutdown, the US dollar index continued its decline, supporting copper prices. Additionally, Trump acknowledged that the US and China are in a trade war, and the tense trade situation dampened market sentiment, putting upward pressure on copper prices. On the fundamentals side, supply side, imported materials maintained stable arrivals, while domestic supplies decreased, leading to an overall tightening of supply. Demand side, copper prices continued to fluctuate at highs, and downstream consumption performance was weak. As of October 16, social inventory of copper cathode in mainstream areas increased by 5,500 mt MoM to 177,500 mt. Overall, under the weak supply-demand pattern in fundamentals, copper prices are expected to have limited upside potential 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.]