Rising Copper Prices Weaken Downstream Purchase Willingness, Some Enterprises Plan to Cut Production

[SMM Shanghai Spot Copper] Looking ahead to tomorrow, the SHFE copper 2608 contract rose further during the night session, basically trading between 106,000 yuan/mt and 106,800 yuan/mt. With the recent synchronized increase in copper prices and spot premiums, while the SHFE contract structure maintains a backwardation structure, downstream purchase willingness has weakened significantly, with transactions mainly driven by rigid demand. According to SMM, affected by high copper prices and accumulated finished product inventories, some downstream processing enterprises plan to cut production or temporarily halt operations. The impact of weakening end-use consumption on the spot market is gradually becoming evident. In terms of supplier behavior, intraday selling drove the premium center lower. Overall, under the combined effect of high copper prices and premiums suppressing downstream demand, along with increased willingness to sell among suppliers, it is expected that spot copper quotations in Shanghai against the 2608 contract will maintain a premium tomorrow, with the overall center likely to edge down slightly.

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