Aug 6, 2026, Thursday
Overnight: LME copper opened at $13,992/mt, dipped to $13,975.5/mt in early trading, then drifted higher to reach an intraday high of $14,150/mt, eventually closing at $14,148.5/mt, up 0.75%. Trading volume was 20,200 lots, and open interest increased to 253,000 lots, up 1,896 lots from the previous trading day, marked by increased long positions. The most-traded SHFE copper 2609 contract opened at 107,350 yuan/mt, hit a high of 107,840 yuan/mt, a low of 107,300 yuan/mt, and closed at 107,770 yuan/mt, up 0.40%. Trading volume was 38,600 lots, and open interest declined to 214,000 lots, down 2,688 lots from the previous trading day, marked by reduced short positions.
[SMM Copper Morning Briefing] News:
(1) On Wednesday, COMEX copper prices hit a record high. The market is betting that the US will impose import tariffs, continuing to attract copper flows into the US while overseas supply tightens. The most-traded COMEX September copper futures briefly touched $6.7045/lb ($14,781/mt), surpassing the previous high of $6.69 set in mid-May. In the afternoon session, the most-traded contract traded at $6.6825, up 0.6% from Tuesday’s settlement, with a year-to-date gain of about 17%.
Spot:
(1) Shanghai: On Aug 5, SMM #1 copper cathode spot premiums against the front-month SHFE 2608 contract were quoted at 120–240 yuan/mt, with an average of 180 yuan/mt, down 50 yuan/mt from the previous trading day. The SHFE 2608 contract moved lower before rebounding in morning trading. It opened at 107,140 yuan/mt, then slipped to an intraday low of 106,800 yuan/mt, stabilized, and climbed to a high of 107,300 yuan/mt, subsequently trading mainly between 107,200–107,270 yuan/mt, closing at 107,230 yuan/mt. The backwardation spread between contracts ranged from 80–180 yuan/mt. The import profit margin for SHFE copper against the 2608 contract stood at a loss of 1,370–1,430 yuan/mt. Sales sentiment for copper cathode in Shanghai was 3.10, up 0.10 from the previous day, while procurement sentiment was 2.88, down 0.03 from the previous day. Historical data can be found in the database. Looking ahead to today, the intraday SHFE copper price center is expected to rise further above 107,000 yuan/mt. High copper prices significantly suppress downstream purchases, with the market still dominated by just-in-time buying. However, suppliers’ willingness to sell has strengthened, leading to consecutive downward quote adjustments during the day to facilitate deals. As standard-quality copper prices pull back, downstream purchase willingness improved, with some low-priced cargoes being transacted gradually. Meanwhile, available high-quality copper and registered SX-EW copper remain scarce, keeping quotes relatively firm and providing some support to spot premiums. On balance, with high copper prices weighing on demand and suppliers actively lowering prices to sell, spot premiums for SHFE copper against the 2608 contract are expected to remain in positive territory today, with the overall center likely to stay under pressure, but improving transactions at lower prices may limit further downside room for premiums.
(2) Guangdong: On Aug 5, Guangdong #1 copper cathode spot against the front-month contract: high-quality copper was quoted at a premium of 110 yuan/mt, up 10 yuan/mt from the previous trading day; standard-quality copper at a premium of 30 yuan/mt, up 30 yuan/mt; and SX-EW copper at a discount of 30 yuan/mt, up 30 yuan/mt. The average price of Guangdong #1 copper cathode was 106,990 yuan/mt, up 450 yuan/mt from the previous trading day, and the average price for SX-EW copper was 106,890 yuan/mt, up 460 yuan/mt. Procurement sentiment for Guangdong copper cathode was 2.40, down 0.02 from the previous trading day, and selling sentiment was 2.81, down 0.04 from the previous trading day (historical data can be accessed in the database). Overall, falling inventory prompted suppliers to hold prices firm, but downstream purchases were cautious, resulting in relatively weak trading.
(3) Imported Copper: On August 5, the average warrant price dropped $4/mt from the previous trading day to $106/mt (price range $100-112/mt); the average B/L price dropped $4/mt from the previous trading day to $101/mt (price range $95-107/mt); the average price of EQ copper (CIF B/L) dropped $3/mt from the previous trading day to $68/mt (price range $64-72/mt), with quotations referring to cargoes arriving in August.
(4) Secondary Copper: On August 5, at 11:30, the futures closing price was 107,230 yuan/mt, up 410 yuan/mt from the previous trading day. The average spot premium was 180 yuan/mt, down 50 yuan/mt from the previous trading day. The price of copper scrap rose 400 yuan/mt from the previous trading day. The sales sentiment index for copper scrap rose to 2.68, and the purchase sentiment index rose to 2. The price difference between copper cathode and copper scrap was 4,077 yuan/mt, down 92 yuan/mt from the previous trading day. The price difference between copper cathode rod and secondary copper rod was 1,760 yuan/mt. According to the SMM survey, stronger copper prices boosted copper scrap suppliers' willingness to sell. In addition, active orders from end-use wire and cable clients and faster cargo pick-up by traders led to ample orders for secondary copper rod enterprises, which urgently needed to procure raw materials from the market to replenish inventories. As a result, trading in the copper scrap market was relatively active during the day.
Price: On the macro front, US ADP employment increased by just 44,000 in July, below market expectations. The cooling labor market eased some concerns about interest rate hikes, and copper prices still edged up despite hawkish signals from Fed officials Kashkari and Cook. In the Middle East, Trump stated on Wednesday morning Beijing time that a US-Iran agreement would be reached within 48 hours. Iran and Oman were also close to reaching a deal on the Strait of Hormuz, but the new route was only a temporary arrangement and the strait's opening still came with conditions, leaving geopolitical uncertainties. Fundamentals-wise, on the supply side, arrivals of domestic copper cathode and imported copper cathode increased slightly recently, and with high copper prices, suppliers' willingness to sell strengthened, further easing the tightness in spot supply. On the demand side, end-use demand remained weak during the traditional consumption off-season, and high copper prices further dampened downstream purchase willingness, with the market mainly restocking on a need-to basis. Overall, copper prices are expected to edge up today.
[The information provided is for reference only. This article does not constitute direct advice for investment research decisions. Clients should make decisions prudently and should not use this as a substitute for independent judgment. Any decisions made by clients have nothing to do with SMM.]
