2025.12.17 Wednesday
Futures: LME copper opened at $11,629/mt overnight. The price center gradually moved up to a high of $11,683/mt at the beginning of the session, then fluctuated downward to probe a low of $11,585/mt, and finally closed at $11,619/mt after considerable fluctuations, with a decline of 0.57%. Trading volume reached 19,900 lots, and open interest stood at 351,000 lots. The most-traded SHFE copper 2602 contract opened at 92,210 yuan/mt, initially rose to 92,390 yuan/mt, then fluctuated downward to a low of 91,610 yuan/mt, and finally closed at 91,830 yuan/mt after considerable fluctuations, with a decline of 0.67%. Trading volume was 56,300 lots, and open interest was 216,000 lots.
[SMM Copper Morning Meeting Summary] News:
(1) On December 15, the London Metal Exchange (LME) announced plans to introduce new position limit rules starting from July 6, 2026, in response to the UK Financial Conduct Authority (FCA) requirement, transferring the authority for setting and managing position limits on commodity derivatives from the regulator to the exchange itself. The new rules will apply to key metals such as aluminum, copper, lead, nickel, tin, and zinc, and related contracts, with limits set on net positions at both the entity and group levels. The LME will release a consultation paper in February 2026, inviting feedback from market participants.
Spot:
(1) Shanghai: On December 16, SMM #1 copper cathode spot prices against the front-month 2512 contract were at a discount of 180-70 yuan/mt, with an average quote at a premium of 125 yuan/mt, down 185 yuan/mt from the previous trading day; SMM #1 copper cathode prices ranged from 91,320 to 92,030 yuan/mt. In the morning, the SHFE copper 2601 contract traded between 91,500 and 92,150 yuan/mt, with the spread between months at C110-C70. Looking ahead, after the delivery of the SHFE copper 2512 contract, suppliers' willingness to circulate spot goods is expected to be weak, and it is anticipated that a significant discount will persist tomorrow.
(2) Guangdong: On December 16, Guangdong #1 copper cathode spot prices against the front-month contract were at a premium of 70-160 yuan/mt, with an average premium of 115 yuan/mt, down 25 yuan/mt from the previous trading day; SX-EW copper was quoted at a discount of 40-0 yuan/mt, with an average discount of 20 yuan/mt, down 50 yuan/mt from the previous trading day. The average price of Guangdong #1 copper cathode was 92,275 yuan/mt, down 100 yuan/mt from the previous trading day, and the average price of SX-EW copper was 92,140 yuan/mt, down 125 yuan/mt from the previous trading day. Overall, long-term contract negotiations are intense, and the spot order market is chaotic, with poor actual transaction conditions.
(3) Imported copper: On December 16, warrant prices were $36-48/mt, QP December, with the average price unchanged from the previous trading day; B/L prices were $43-53/mt, QP January, with the average price unchanged from the previous trading day. EQ copper (CIF B/L) prices were $8-16/mt, QP January, with the average price unchanged from the previous trading day, referencing shipments arriving in late December and early January.
(4) Secondary Copper: At 11:30 on December 16, the futures closing price was 91,700 yuan/mt, down 590 yuan/mt from the previous trading day. The average spot premium/discount was -125 yuan/mt, down 185 yuan/mt from the previous day. Today, the price of recycled copper raw materials remained unchanged MoM. The price of bare bright copper in Guangdong was 81,800-82,000 yuan/mt, unchanged from the previous trading day. The price difference between copper cathode and copper scrap was 3,981 yuan/mt, down 775 yuan/mt MoM. The price difference between copper cathode rod and secondary copper rod was 1,560 yuan/mt. According to an SMM survey, as copper prices continued to weaken, transactions in the secondary copper rod market recovered. After traders profited from futures arbitrage, their cargo pick-up speed accelerated. Secondary copper rod enterprises indicated that downstream demand still showed no significant improvement.
(5) Inventories: On December 15, LME copper cathode inventories increased by 725 mt to 166,600 mt. On December 16, SHFE warrant inventories increased by 3,558 mt to 45,784 mt.
Prices: On the macro front, US non-farm payroll growth in November was stronger than expected, but the unemployment rate rose to 4.6%, a four-year high, indicating mixed signals from the job market. Additionally, uncertainty over the US Fed Chairman appointment intensified, adding variables to the future policy path. On the fundamentals side, supply side, effective market supply was sufficient, and suppliers were active in selling, but their willingness to sell is expected to weaken after delivery. Demand side, despite the pullback in copper prices, downstream purchasing remained cautious due to high price suppression, and overall demand performance was weak. Overall, copper prices are expected to remain supported today.
[The information provided is for reference only. This article does not constitute direct advice for investment research decisions. Clients should make decisions cautiously and not use this to replace their own independent judgment. Any decisions made by clients are unrelated to SMM.]
