Argentina's Mining Sector Receives US Investment, LME Copper Fluctuated and Closed Higher Overnight [SMM Copper Morning Meeting Minutes]

Tuesday, October 28, 2025

Futures: Overnight, LME copper opened at $11,030.5/mt, hitting a high of $11,042/mt at the opening, then the center of copper prices declined all the way to a low of $10,917/mt, and finally closed at $11,000.5/mt, up 0.49%, with trading volume reaching 25,000 lots and open interest at 321,000 lots. Overnight, the most-traded SHFE copper 2512 contract opened at 88,160 yuan/mt, hitting a high of 88,270 yuan/mt at the opening, then the center of copper prices declined all the way to a low of 87,310 yuan/mt, and finally closed at 88,130 yuan/mt, up 0.22%, with trading volume reaching 117,000 lots and open interest at 287,000 lots.

[SMM Copper Morning Meeting Minutes] News:

(1) On October 25, Argentina received about $20 billion in support from the US to promote mining projects in lithium, copper, and energy. The plan is seen as a strong endorsement by the US of President Milei's reform path, with the key to success lying in maintaining political and economic stability. The US Treasury's capital injection aims to enhance Argentina's foreign exchange reserves and attract more foreign investment into resource development. Meanwhile, the Argentine government is advancing a major investment system and infrastructure construction to improve transportation and export conditions in mining areas. Analysts warn that if domestic political turmoil or economic management imbalances occur, investment confidence may quickly decline, posing challenges to the prospects of mining recovery.

Spot:

(1) Shanghai: On October 27, SMM #1 copper cathode spot prices against the front-month 2511 contract were at a discount of 100 yuan/mt to a premium of 10 yuan/mt, with the average price quoted at a discount of 55 yuan/mt, down 55 yuan/mt from the previous trading day; SMM #1 copper cathode prices ranged from 88,020 to 88,410 yuan/mt. In early trading, SHFE copper surged to around 88,500 yuan/mt, then slightly retreated to around 88,200 yuan/mt, before continuing to rise to 88,400 yuan/mt and closing at 88,360 yuan/mt. The inter-month price spread fluctuated between a contango of 90 yuan/mt and a contango of 50 yuan/mt, and the import loss for the front-month SHFE copper contract remained around 1,000 yuan/mt. Looking ahead to tomorrow, with copper prices holding above 88,000 yuan/mt, downstream purchasing sentiment has significantly decreased, and suppliers are expected to continue lowering prices to move cargo.

(2) Guangdong: On October 27, Guangdong #1 copper cathode spot prices against the front-month contract were at a discount of 50 yuan/mt to a premium of 50 yuan/mt, with the average premium at 0 yuan/mt, down 30 yuan/mt from the previous trading day; SX-EW copper was quoted at a discount of 130 yuan/mt to a discount of 90 yuan/mt, with the average discount at 110 yuan/mt, down 50 yuan/mt from the previous trading day. The average price of Guangdong #1 copper cathode was 88,140 yuan/mt, up 1,695 yuan/mt from the previous trading day, and the average price of SX-EW copper was 88,030 yuan/mt, up 1,675 yuan/mt from the previous trading day. Overall, with copper prices hitting new highs, downstream buyers largely refrained from purchasing, and spot trades were very sluggish.

(3) Imported copper: On Oct 27, warrant prices were $30-40/mt, QP November, with the average price down $3/mt from the previous trading day; B/L prices were $42-64/mt, QP November, with the average price flat from the previous trading day. EQ copper (CIF B/L) was -$12-2/mt, QP November, with the average price down $5/mt from the previous trading day. Quotations referred to cargoes arriving in late October and early November.

(4) Secondary copper: At 11:30 on Oct 27, the futures closing price was 88,360 yuan/mt, up 1,700 yuan/mt from the previous trading day. The average spot premium/discount was -45 yuan/mt, down 55 yuan/mt from the previous trading day. Today, the price of recycled copper raw materials rose 1,000 yuan/mt MoM. The price of bare bright copper in Guangdong was 78,800-79,000 yuan/mt, up 1,000 yuan/mt from the previous trading day. The price difference between copper cathode and copper scrap was 4,379 yuan/mt, up 432 yuan/mt MoM. The price difference between copper cathode rod and secondary copper rod was 2,020 yuan/mt. According to an SMM survey, due to prolonged shutdowns, some secondary copper rod enterprises in Jiangxi, Anhui, and Jiangsu paid taxes today and plan to start furnace heating on the 31st of this month, resuming normal production from Nov 1.

(5) Inventory: On Oct 24, LME copper cathode inventories decreased by 375 mt to 135,975 mt; on Oct 27, SHFE warrant inventories decreased by 321 mt to 35,392 mt.

Prices: On the macro front, the Ministry of Foreign Affairs responded to China-US economic and trade consultations, clarifying that both sides agreed to further finalise specific details. Additionally, with the US Fed's interest rate meeting approaching, an interest rate cut is highly likely due to US inflation data falling below market expectations, boosting market sentiment and providing support for copper prices. On the fundamentals side, supply side, both imported and state-owned cargoes arrived, but warehouse withdrawals were weak, leading to a tightening of overall supply. Demand side, copper prices surged again, suppressing downstream purchasing sentiment. Overall, amid the weak supply-demand dynamics, copper prices are expected to have limited upside 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.]