U.S. September Employment Data Shows Divergence; LME Copper Fluctuated Overnight and Closed Lower [SMM Copper Morning Meeting Minutes]

Friday, 2025.11.21

Futures: LME copper opened at $10,789.5/mt overnight, fluctuated upward and touched a high of $10,827/mt early in the session. Subsequently, the price center of copper gradually moved downward, approaching a low of $10,680/mt near the session's close, and finally settled at $10,686/mt, down 1.08%. Trading volume reached 18,600 lots, and open interest reached 317,000 lots. The most-traded SHFE copper contract 2601 opened at 86,380 yuan/mt overnight, touched a high of 86,620 yuan/mt early in the session, then fluctuated downward and closed at the session's low of 85,920 yuan/mt, down 0.53%. Trading volume reached 44,100 lots, and open interest reached 190,000 lots.

[SMM Copper Morning Conference Minutes] News:

(1) On November 20, according to market news, Codelco offered its 2026 CIF South Korea copper cathode long-term contract price at $330/mt, up $245/mt compared to the 2025 price of $85/mt, hitting a record high.

Spot:

(1) Shanghai: On November 20, SMM's #1 copper cathode spot prices against the front-month 2512 contract were quoted at a premium of 10-150 yuan/mt, with an average premium of 80 yuan/mt, down 5 yuan/mt from the previous trading day. The SMM #1 copper cathode price ranged from 86,180 to 86,690 yuan/mt. The intermonth spread fluctuated between Contango 50 and Contango 10. The import loss for SHFE front-month copper expanded to within 800 yuan/mt. Looking ahead to tomorrow, warrants continue to flow out, and prices in Jiangsu may still face potential suppression. However, there is some trading demand in Shanghai, and demand for standard-quality copper supply persists, supporting premiums.

(2) Guangdong: On November 20, Guangdong's #1 copper cathode spot prices against the front-month contract were quoted at a premium of 10-100 yuan/mt, with an average premium of 55 yuan/mt, up 20 yuan/mt from the previous trading day. SX-EW copper was quoted at a discount of 80-40 yuan/mt, with an average discount of 60 yuan/mt, up 10 yuan/mt from the previous trading day. The average price for Guangdong's #1 copper cathode was 86,460 yuan/mt, up 470 yuan/mt from the previous day. The average price for SX-EW copper was 86,345 yuan/mt, up 460 yuan/mt from the previous day. Overall, inventory fell significantly for the second consecutive day, prompting suppliers to actively hold prices firm. However, downstream purchase desire declined, leading to only a slight increase in spot premiums.

(3) Imported Copper: On November 20, warrant prices were $27-39/mt, QP December, with the average price flat from the previous trading day. Bill of lading (B/L) prices were $42-54/mt, QP December, with the average price flat from the previous trading day. EQ copper (CIF B/L) was $0-12/mt, QP December, with the average price up $1/mt from the previous trading day. Quotations refer to cargoes arriving in mid-to-late November and early December.

(4) Secondary Copper: As of 11:30 on November 20, the futures closing price was 86,290 yuan/mt, up 210 yuan/mt from the previous trading day. The average spot premium/discount was 80 yuan/mt, down 5 yuan/mt from the previous trading day. Today, the price of recycled copper raw materials rose 200 yuan/mt. The price of bare bright copper in Guangdong was 78,300-78,500 yuan/mt, up 200 yuan/mt from the previous trading day. The price difference between copper cathode and copper scrap was 3,066 yuan/mt, up 92 yuan/mt MoM. The price difference between copper cathode rod and secondary copper rod stood at 1,580 yuan/mt. According to the SMM survey, as copper prices fluctuated and consolidated, transactions of secondary copper rod were mediocre during the day. With shipments from secondary copper rod enterprises decreasing, their purchase willingness for recycled copper raw materials remained low, leading to a relatively loose supply of circulating recycled copper raw materials in the market.

(5) Inventory: On November 19, LME copper cathode inventories increased by 50 mt to 157,925 mt; on November 20, SHFE warrant inventories decreased by 3,369 mt to 54,983 mt.

Price: On the macro front, US September employment data showed mixed performance, with non-farm payrolls unexpectedly rising but the unemployment rate climbing to a four-year high. Contradictory signals from the labour market increased the difficulty for the US Fed in making policy decisions. Several Fed officials remained vigilant about inflation risks, with Barr reiterating the 2% inflation target, Harker warning that interest rate cuts could prolong high inflation, and Goolsbee adopting a cautious stance toward a December rate cut. Under these circumstances, the interest rate market maintained expectations for no rate change in December, and the US dollar index continued to fluctuate at highs, putting pressure on copper prices. On the fundamentals side, supply-side imports and arrivals increased, while demand recovered somewhat after copper prices pulled back. In terms of inventory, as of Thursday, November 20, SMM copper inventories in mainstream regions across China increased by 700 mt from Monday to 194,500 mt. Overall, copper prices are expected to remain supported 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.]