Weakened trade demand, spot premiums quoted high but traded low in the morning session [SMM Shanghai spot copper]

SMM Dec 17:

Today, SMM #1 copper cathode spot prices against the SHFE front-month 2601 contract were quoted at a discount of 200 yuan/mt to a discount of 80 yuan/mt, with an average discount of 140 yuan/mt, up 10 yuan/mt from the previous trading day. The SMM #1 copper cathode price ranged between 92,100 yuan/mt and 92,380 yuan/mt. In early trading, the SHFE copper 2601 contract fluctuated rangebound between 92,300 yuan/mt and 92,480 yuan/mt, with the inter-month spread largely between a contango of C120 and C90.

In the morning session, suppliers offered at higher premiums, but transactions were limited. Most enterprises faced significant year-end payment collection and funding needs, and expectations were for the SHFE copper 2601-2602 contango structure to widen. Early in the session, suppliers quoted standard-quality copper at around a discount of 140 yuan/mt against the next-month contract, with high-quality copper at around a discount of 100 yuan/mt. Subsequently, during the second session, prices quickly fell to a discount of 200 yuan/mt for standard-quality copper, while high-quality copper was quoted at a discount of 120 yuan/mt.

Looking ahead to tomorrow, spot liquidity is expected to remain relatively weak, and with selling pressure pushing offers, premiums still have some slight downside room.