Korea Zinc to Build Integrated Smelter LME Copper Fluctuated and Closed Higher Overnight [SMM Copper Morning Meeting Minutes]

Tuesday, Dec. 16, 2025

Futures: LME copper opened at $11,674/mt overnight. At the beginning of the session, copper prices fluctuated upward, touching a high of $11,890.5/mt, then fluctuated downward to a low of $11,644/mt, followed by considerable fluctuations, and finally closed at $11,686/mt, up 1.16%. Trading volume reached 23,200 lots, and open interest reached 351,000 lots. Overnight, the most-traded SHFE copper 2602 contract opened at 93,500 yuan/mt, rose to 93,820 yuan/mt early in the session, then fluctuated downward, touching a low of 92,250 yuan/mt near the end of the session, and finally closed at 92,480 yuan/mt, down 0.18%. Trading volume reached 91,500 lots, and open interest reached 222,000 lots.

[SMM Copper Morning Meeting Minutes] News:

(1) On Dec. 15, KOREA ZINC announced: It plans to advance the construction of an integrated complex non-ferrous metals smelter through its US subsidiary Crucible Metals, LLC, which will produce and recycle major non-ferrous metals such as zinc, lead, and copper, precious metals such as gold and silver, and strategic minerals such as antimony, germanium, and gallium. The smelter will be constructed in phases (2027-2029) and commence commercial operations in stages, with an annual target production involving copper capacity of 35,000 mt.

Spot:

(1) Shanghai: On Dec. 15, SMM's #1 copper cathode spot prices against the front-month 2512 contract were quoted at a discount of 30 yuan/mt to a premium of 150 yuan/mt, with an average premium of 60 yuan/mt, up 80 yuan/mt from the previous trading day. SMM's #1 copper cathode prices were 92,070-92,460 yuan/mt. As it was the last trading day for the SHFE copper 2512 contract, according to the SMM #1 copper cathode price assessment methodology, SMM consistently quotes against the front-month contract. In the morning session, the SHFE copper 2512 contract mainly traded between 92,090-92,330 yuan/mt, while the SHFE copper 2601 contract traded between 92,200-92,510 yuan/mt; the inter-month price spread was basically between contango 200 and contango 100. Looking ahead to today, with Shanghai warehouse inventory increasing only slightly, indicating limited supply from both domestic and imported sources, spot prices against the SHFE copper 2601 contract are expected to start from a discount tomorrow.

(2) Guangdong: On Dec. 15, Guangdong's #1 copper cathode spot prices against the front-month contract were quoted at a premium of 100-180 yuan/mt, with an average premium of 140 yuan/mt, up 45 yuan/mt from the previous trading day. SX-EW copper was quoted at a premium of 10-50 yuan/mt, with an average premium of 30 yuan/mt, up 30 yuan/mt from the previous trading day. The average price for Guangdong's #1 copper cathode was 92,375 yuan/mt, down 1,275 yuan/mt from the previous trading day, while the average price for SX-EW copper was 92,265 yuan/mt, down 1,290 yuan/mt from the previous trading day. Overall, downstream restocking increased as copper prices fell sharply, leading to higher spot premiums.

(3) Imported copper: On Dec. 15, warrant prices were $36-48/mt, QP December, with the average price up $1/mt from the previous trading day; bill of lading (B/L) prices were $43-53/mt, QP January, with the average price up $1/mt from the previous trading day; EQ copper (CIF B/L) prices were $8-16/mt, QP January, with the average price up $3/mt from the previous trading day. Quotations refer to cargoes arriving in late December and early January.

(4) Secondary Copper: At 11:30 on December 15, the futures closing price was 92,290 yuan/mt, down 1,190 yuan/mt from the previous trading day. The average spot premium/discount was 60 yuan/mt, up 80 yuan/mt from the previous trading day. Today, the price of recycled copper raw materials fell 1,000 yuan/mt MoM. The price of bare bright copper in Guangdong was 81,800-82,000 yuan/mt, down 1,000 yuan/mt from the previous trading day. The price difference between copper cathode and copper scrap was 4,797 yuan/mt, down 41 yuan/mt MoM. The price difference between copper cathode rod and secondary copper rod was 2,010 yuan/mt. According to the SMM survey, as copper prices pulled back, many secondary copper raw material traders in the market held prices firm for shipments, resulting in no significant change in the price difference between copper cathode and copper scrap. Many secondary copper rod enterprises reported very few transactions for recycled copper raw materials today.

(5) Inventory: On December 12, LME copper cathode inventory decreased by 25 mt to 165,900 mt. On December 15, SHFE warrant inventory increased by 9,663 mt to 42,226 mt.

Price: On the macro front, market focus has shifted from the interest rate cuts themselves to the uncertainty surrounding their subsequent path. There are significant divergences within the US Fed regarding the future pace of policy, and they clearly stated that decisions will be strictly data-dependent. Meanwhile, the positive policy signals released from the domestic Central Economic Work Conference provided important support for market sentiment. On the fundamentals side, supply side, although arrivals were limited, driven by futures delivery and year-end funding pressure, suppliers concentrated on selling, leading to a looser supply in the spot market. Demand side, it was significantly suppressed by high copper prices, with purchasing sentiment weakening. Inventory side, as of Monday, December 15, SMM national mainstream copper inventories increased by 1,500 mt WoW to 164,500 mt. Overall, 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 or decision-making advice. Clients should make decisions cautiously and not use this to replace their own independent judgment. Any decisions made by clients are unrelated to SMM.]