The Trump Administration Plans Military Action Against Venezuela, Overnight LME Copper Plummets [SMM Copper Morning Meeting Minutes]

Wednesday, November 5, 2025

Futures: Overnight, LME copper opened at $10,630.5/mt, fluctuated downward initially to touch a low of $10,577.5/mt, then copper prices gradually moved upward to touch a high of $10,689.5/mt, before the center pulled back and finally closed at $10,649/mt, down 1.57%, with trading volume reaching 33,000 lots and open interest reaching 325,000 lots. Overnight, the most-traded SHFE copper 2512 contract opened at 85,000 yuan/mt, touched a low of 84,900 yuan/mt initially, then fluctuated upward to touch a high of 85,760 yuan/mt near the close, and finally settled at 85,690 yuan/mt, down 0.86%, with trading volume reaching 69,000 lots and open interest reaching 223,000 lots.

[SMM Copper Morning Meeting Minutes] News:

(1) On November 4, Glencore plans to gradually shut down its Horne Smelter in Quebec, Canada, due to high environmental upgrade costs and operating costs. Glencore operates the Horne Smelter (smelting capacity of 200,000 mt) and the CCR copper refinery in Quebec, Canada. The Horne Smelter processes copper concentrates into copper anodes, which are further processed into copper cathodes by the CCR refinery.

Spot:

(1) Shanghai: On November 4, SMM #1 copper cathode spot prices against the front-month 2511 contract were at a discount of 70 yuan/mt to a premium of 70 yuan/mt, with the average price at parity, up 5 yuan/mt from the previous trading day; SMM #1 copper cathode prices ranged from 86,290 to 86,890 yuan/mt. In early trading, SHFE copper fell from 86,800 yuan/mt to 86,400 yuan/mt, with the inter-month price spread fluctuating between a contango of 20 yuan/mt and a backwardation of 20 yuan/mt, and import losses for SHFE front-month copper narrowed to around 800 yuan/mt. Looking ahead, with copper prices falling below 86,000 yuan/mt, downstream purchasing sentiment improved somewhat, but bearish psychology persists, and as the contango spread gradually narrows, suppliers may offer premiums at a discount to promote transactions.

(2) Guangdong: On November 4, Guangdong #1 copper cathode spot prices against the front-month contract were at a discount of 50 yuan/mt to a premium of 10 yuan/mt, with the average discount at 20 yuan/mt, down 10 yuan/mt from the previous trading day; SX-EW copper was quoted at a discount of 120 yuan/mt to 80 yuan/mt, with the average discount at 100 yuan/mt, down 10 yuan/mt from the previous trading day. The average price of Guangdong #1 copper cathode was 86,735 yuan/mt, down 200 yuan/mt from the previous trading day, and the average price of SX-EW copper was 86,655 yuan/mt, down 200 yuan/mt from the previous trading day. Overall, downstream consumption remained weak, forcing suppliers to lower prices for shipments, and overall trading was moderate.

(3) Imported copper: On November 4, warrant prices were $30-40/mt, QP November, average price flat from the previous trading day; B/L prices were $40-62/mt, QP November, average price flat from the previous trading day; EQ copper (CIF B/L) was at -$20/mt to -$6/mt, QP November, average price flat from the previous trading day, with offers referring to cargoes arriving in early to mid-November.

(4) Secondary Copper: The SHFE closing price at 11:30 on November 4 was 86,400 yuan/mt, down 330 yuan/mt from the previous trading day. The average spot premium/discount was 0 yuan/mt, up 5 yuan/mt from the previous trading day. The price of recycled copper raw materials remained unchanged WoW. The price of bare bright copper in Guangdong was 78,000-78,200 yuan/mt, down 300 yuan/mt from the previous trading day. The price difference between copper cathode and copper scrap was 3,315 yuan/mt, down 6 yuan/mt WoW. The price difference between copper cathode rod and secondary copper rod was 1,390 yuan/mt. According to the SMM survey, after copper prices retreated significantly in the afternoon, many secondary copper rod enterprises stopped purchasing, and recycled copper raw material traders also suspended purchases.

(5) Inventories: LME copper cathode inventories increased by 300 mt to 133,900 mt on November 3; SHFE warrant inventories increased by 1,081 mt to 41,147 mt on November 4.

Prices: On the macro front, the Trump administration's plan to take military action against Venezuela, coupled with the 35-day shutdown of the US federal government, heightened geopolitical and policy uncertainties, boosting safe-haven sentiment. Meanwhile, the US Fed remained divided on the path of interest rate cuts, collectively pushing the US dollar index above the 100 mark and putting copper prices under pressure. On the fundamentals side, the supply of high-quality copper remained tight, while standard-quality copper and non-registered sources were relatively ample. Demand side, although some rigid demand was released as copper prices retreated, market wait-and-see sentiment remained strong. Overall, copper prices are expected to fluctuate rangebound today.

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