East China inventory drawdown exceeded expectations, strengthening downside support for Shanghai spot copper premiums [SMM Shanghai spot copper]

Published: Aug 24, 2026 13:31

Save

[SMM Shanghai spot copper] Looking ahead to tomorrow, SMM recorded social inventory in the Shanghai region at 70,800 mt, down 12,300 mt WoW from last Thursday; social inventory in the Jiangsu region at 16,300 mt, down 4,100 mt WoW from last Thursday. Inventory in the two regions in east China totaled a reduction of 16,400 mt, with destocking exceeding market expectations. Supply side, due to the persistently unfavorable SHFE/LME price ratio, port arrivals of ex-China cargoes have decreased, and combined with some shipping schedule delays, imported copper has provided relatively limited supplementation to the spot market. Demand side, after copper prices experienced a slight correction last week, downstream dip-buying demand was released. Meanwhile, the backwardation spread between consecutive months once widened, enhancing suppliers' willingness to sell and accelerating market cargo turnover, jointly driving a significant inventory decline. Intraday buying sentiment rebounded to some extent, but quotes for standard-quality copper still required successive downward adjustments before transactions could occur, reflecting that downstream buyers' acceptance of high premiums remains limited. Overall, against the backdrop of significant destocking in east China inventory and low imported arrivals supporting premiums, while downstream buyers mainly engage in dip-buying and just-in-time procurement and suppliers' willingness to sell persists, spot prices against the SHFE copper 2609 contract are expected to maintain premiums tomorrow, with the overall center likely to gradually stop falling and stabilize. The room for further significant declines is relatively limited.

SMM August 24 news:

Today, SMM #1 copper cathode spot prices against the SHFE copper 2609 contract were quoted at a premium of 150-270 yuan/mt, with an average premium of 210 yuan/mt, down 65 yuan/mt from the previous trading day. The SHFE copper 2609 contract showed a pattern of first falling and then consolidating. After the market opened in the morning session, prices quickly declined, hitting a low of around 107,600 yuan/mt during the session; subsequently, prices repeatedly rebounded, once rising to around 107,860 yuan/mt, but encountered significant resistance on the upside. Approaching midday, prices pulled back again and then rebounded slightly, eventually closing at 107,760 yuan/mt. The overall trading center of gravity in the morning was below the average price line. The inter-month Back spread ranged between 170-220 yuan/mt. The SHFE copper 2609 contract import profit margin ranged from a loss of 1,080 yuan/mt to a loss of 1,000 yuan/mt.

During the day, the sentiment for selling copper cathode in Shanghai was 3.06, down 0.52 WoW, and the sentiment for procurement was 2.93, up 0.35 WoW. Historical data can be queried in the database. In the early morning session, suppliers' first round of quotes for standard-quality copper ranged from a premium of 180-210 yuan/mt, after which suppliers significantly lowered quotes. Brands such as Tiefeng, Zijin, and Zhongtiaoshan quoted premiums of 150-160 yuan/mt, while Jinguan, Jinxin, Jinfeng, and Jintun quoted EXW premiums of 180-190 yuan/mt. High-quality copper was scarce in supply, with only a limited volume of Guixi and Jintun large slabs circulating, quoted at premiums of 300-350 yuan/mt. Registered SX-EW copper was quoted with a premium of 140 yuan/mt by Laos in the early morning, while non-registered copper was quoted at premiums of 100-120 yuan/mt. Entering the second session, suppliers further lowered quotes, with JCC and Lufang trading at premiums of 170-180 yuan/mt.

Looking ahead to tomorrow, SMM recorded social inventory in east China's Shanghai region at 70,800 mt, down 12,300 mt WoW from last Thursday; social inventory in Jiangsu region stood at 16,300 mt, down 4,100 mt WoW from last Thursday. Combined inventory in the two east China regions declined by 16,400 mt, with the destocking magnitude exceeding market expectations. In terms of supply, due to the persistently poor SHFE/LME price ratio, port arrivals of cargo from outside China decreased, coupled with some shipment delays, making the supply supplement from imported copper to the spot market relatively limited. On the demand side, after copper prices experienced a slight correction last week, downstream buyers released some dip-buying demand. Meanwhile, the inter-month Back spread once widened, enhancing suppliers' willingness to sell and accelerating the turnover of market cargo, collectively driving a notable inventory decline. Although procurement sentiment rebounded during the day, standard-quality copper quotes still required consecutive downward adjustments to achieve transactions, reflecting downstream buyers' limited acceptance of the higher premiums. Overall, with east China inventory significantly de-stocked and reduced import arrivals supporting premiums, but downstream buyers still focusing on just-in-time procurement on dips and suppliers' willingness to sell remaining, Shanghai spot copper prices against the SHFE copper 2609 contract are expected to maintain a premium tomorrow. The overall center of gravity may gradually stop falling and stabilize, with relatively limited room for further significant declines.

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or for more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

8 mins ago

[SMM Analysis]Millberry Payability Returns to High Levels—Why Are No. 1 and No. 2 Copper Scrap Lagging?

[SMM Analysis: Millberry Payability Returns to High Levels—Why Are No. 1 and No. 2 Copper Scrap Lagging?]According to SMM market research, Millberry payability has returned to 98%-99%, while No. 1 copper scrap is quoted at 95.5%-96.5% and No. 2 at 94.5%-95.5%. Market tightness is therefore concentrated in clean, high-grade material.

8 mins ago

19 mins ago

Peru Targets at Least US$33 Billion in Mining Investment as Government Moves to Accelerate Project Approvals

Peru’s new government is targeting at least US$33 billion in mining investment over the next five years, while moving to accelerate approvals for exploration and extraction projects in an effort to convert the country’s extensive mineral resources and project pipeline into new production. Prime Minister Luis Galarreta told Congress that President Keiko Fujimori’s administration, which took office in July, plans to authorize 240 exploration and extraction projects this year. Private companies are expected to provide the investment, while the government intends to focus on legal certainty, more predictable permitting and faster decision-making. Officials will seek to reduce delays and overlapping procedures without weakening environmental or social requirements. The push is particularly significant for the copper market. Peru produced 2.77 million tonnes of copper in 2025, up 1.2% year on year, according to the Ministry of Energy and Mines, marking the country’s highest annual copper production on record. Peru remains one of the world’s largest copper-producing countries, meaning improvements in project execution could have meaningful implications for longer-term global mine supply. The investment target also comes against the backdrop of a sizeable existing project pipeline. MINEM’s 2026 Mining Investment Project Portfolio comprises 66 projects with combined estimated investment of US$64.08 billion, while eight mining projects representing around US$7.62 billion had already been identified for the start of execution during 2026. For the copper market, the key issue is therefore less Peru’s geological potential than the speed at which projects can move through permitting, financing and construction. The Fujimori government’s plan to authorize hundreds of projects and reduce administrative bottlenecks could help unlock part of Peru’s large copper development pipeline, although the eventual production impact will depend on which projects actually progress into construction and operation.

19 mins ago

38 mins ago

Copper Cathode Social Inventory Sees Significant Drawdown, All Regions Simultaneously Digest Spot Copper [SMM Weekly Data]

38 mins ago