Tight supply coupled with pre-holiday stockpiling drives SHFE copper premiums sharply higher [SMM Copper Morning Meeting Notes]

Wednesday, September 23, 2026
Futures: Overnight LME copper opened at $14,782.5/mt, initially drifted higher to touch $14,799/mt, then the price center drifted lower to $14,728/mt, before drifting higher again to close at $14,783/mt, up 0.81%. Trading volume reached 20,500 lots, and open interest stood at 264,000 lots, down 3,223 lots from the previous trading day, reflecting bear position reduction. Overnight, the most-traded SHFE copper 2610 contract opened at and touched a high of 111,840 yuan/mt, then drifted lower to 111,490 yuan/mt, and subsequently consolidated to close at 111,610 yuan/mt, up 0.35%. Trading volume reached 22,600 lots, and open interest stood at 142,300 lots, down 4,459 lots from the previous trading day, reflecting bear position reduction.
[SMM Copper Morning Meeting Summary] News:
(1) The global energy transition continues to accelerate, and the iterative upgrading of the new energy industry is driving sustained expansion in demand for critical strategic minerals such as copper, cobalt, tin, and lithium. The global supply-demand pattern and supply chain system for energy metals are undergoing profound restructuring. Resource reserves, development efficiency, green production, and cross-border supply chain stability of critical minerals have become important factors influencing global industrial upgrading, energy security, and commodity market pricing. The African continent, endowed with the world's richest critical mineral resources, is gradually becoming a strategic hinterland for the global new energy mineral supply chain layout, profoundly shaping the future trajectory of the global mining and new energy industries. Against the backdrop of global low-carbon development and increasingly sophisticated ESG compliance systems, the traditional single-resource export model can no longer meet the new demands of industrial development. African mining is accelerating its transformation toward a new stage featuring green extraction, local deep processing, high-value-added upgrading of the industry chain, and cross-border collaborative development. At the same time, shifting geopolitical dynamics, mineral policy adjustments in various countries, and structural changes in end-use demand have further heightened supply chain uncertainty. Miners, trading institutions, technical service providers, and investment institutions in China and overseas urgently need to establish a frontline presence in Africa's core producing regions to precisely capture the latest developments in industrial policy, resource development, technology deployment, and trade flows. Zambia, as a core copper and cobalt producer in Africa, possesses a mature mining industry foundation and a continuously improving business and investment environment, making it an important hub for critical mineral development and cross-border mining cooperation in Southern Africa. Currently, the country is making every effort to advance localized processing and conversion of mineral resources, green mine development, and new energy infrastructure deployment, continuously releasing new dividends in mining investment and becoming a key battleground for global enterprises positioning themselves in Africa's critical minerals sector.
Spot:
(1) Shanghai: On September 22, SMM #1 copper cathode spot prices against the SHFE copper 2610 contract were quoted at premiums of 1,150-1,600 yuan/mt, with an average premium of 1,375 yuan/mt, up 550 yuan/mt from the previous trading day. In early trading, the SHFE copper 2610 contract opened higher with a gap and then consolidated upward. After the open, prices pulled back slightly, dipping to around 110,820 yuan/mt, before gradually rebounding and climbing above 111,000 yuan/mt. Copper prices continued to rise during the session, breaking above 111,500 yuan/mt to touch a high near 111,750 yuan/mt, then pulled back slightly from highs, closing the morning session at 111,570 yuan/mt. The backwardation spread between the front-month and next-month contracts stood at 430-610 yuan/mt, while the import profit margin for SHFE copper against the 2609 contract was at a loss of 1,460-1,200 yuan/mt. During the day, the sales sentiment for copper cathode in Shanghai was 3.65, up 0.20 MoM, and the procurement sentiment was 3.75, up 0.08 MoM. Historical data can be queried in the database. Looking ahead to today, available spot supply in Shanghai is expected to remain tight, and with some downstream processing enterprises still having pre-holiday stocking demand, spot premiums remain well supported. Although some imported cargoes locked in when the import window opened earlier are gradually arriving, overall volumes are limited, and their near-term supply replenishment effect is expected to be modest, making it difficult to significantly ease the current tightness. Therefore, spot premiums are expected to have further upside today. However, copper prices are already at elevated levels, the backwardation spread has widened, and spot premiums have climbed rapidly, significantly increasing procurement costs for downstream and end-user enterprises, which may gradually reduce their acceptance of high premiums. If premiums continue to rise rapidly, some downstream buyers may turn cautious, reducing just-in-time procurement, and market trading activity may pull back. Market participants are advised to watch for negative feedback risks on the demand side amid the combination of high copper prices, high backwardation, and high premiums.
(2) Guangdong: On September 22, Guangdong #1 copper cathode spot prices against the front-month contract: high-quality copper was quoted at a premium of 1,300 yuan/mt, up 400 yuan/mt from the previous trading day; standard-quality copper was quoted at a premium of 1,000 yuan/mt, up 300 yuan/mt from the previous trading day; SX-EW copper was quoted at a premium of 940 yuan/mt, up 300 yuan/mt from the previous trading day. The average price of Guangdong #1 copper cathode was 112,235 yuan/mt, up 1,460 yuan/mt from the previous trading day, while the average price of SX-EW copper was 112,025 yuan/mt, up 1,410 yuan/mt from the previous trading day. The procurement sentiment for copper cathode in Guangdong was 2.71, up 0.06 from the previous trading day, while the shipment sentiment was 2.65, down 0.03 from the previous trading day (historical data can be queried by logging into the database). Overall, copper prices and spot premiums both rose sharply, but downstream purchases remained active, and premiums are expected to have further upside tomorrow.
(3) Imported copper: On September 22, the average warrant price fell $2/mt from the previous trading day to $117/mt (price range: $110-124/mt); the average B/L price fell $1/mt from the previous trading day to 112 yuan/mt (price range: 104-120 yuan/mt); the average EQ copper (CIF B/L) price fell $3/mt from the previous trading day to $52/mt (price range: $46-58/mt), with quotes referencing cargoes arriving from September to mid-to-late October.
(4) Secondary copper: On September 22, at 11:30, the futures closing price was 111,570 yuan/mt, up 1,610 yuan/mt from the previous trading day. The average spot premium was 1,375 yuan/mt, up 550 yuan/mt MoM from the previous trading day. Today, secondary copper raw material prices rose 200 yuan/mt MoM. The secondary copper raw material sales sentiment index fell to 2.67, and the purchase sentiment index fell to 1.97. The price difference between copper cathode and copper scrap was 4,071 yuan/mt, up 930 yuan/mt MoM. The price difference between copper cathode rod and secondary copper rod was 2,590 yuan/mt. According to the SMM survey, secondary copper raw material prices showed an unusual pattern of falling but not rising. After copper prices broke through 110,000 yuan, secondary copper rod enterprises almost lost their purchase willingness. Even as copper prices continued to rise, secondary copper rod enterprises kept their raw material quotes unchanged, mainly because they could not afford such high secondary copper raw material prices. As a result, there was almost no trading in the secondary copper raw material market during the day.
Prices: On the macro front, US and Iranian officials held productive talks. Trump said another meeting would be held soon and he believed a deal could be reached after the midterm elections. Iran proposed conditions for reopening the strait, including lifting the blockade and unfreezing assets. Saudi Arabia restarted the east-west pipeline to resume Yanbu exports, and Asian refiners received Saudi assurances that they could lift crude soon. Crude oil prices continued to fall, easing inflation pressure. Combined with tight domestic spot supply, this was bullish for copper prices. On the fundamentals side, available supply remained tight, suppliers held back from selling, and imported arrivals were limited, keeping overall supply tight. On the demand side, pre-holiday stocking demand remained, but downstream buyers were reluctant to chase higher prices, with purchases mainly driven by rigid demand. Overall, copper prices are expected to maintain a fluctuating trend with an upward bias today.
[The information provided is for reference only. This article does not constitute direct investment research or decision-making advice. Clients should make decisions prudently and not use this as a substitute for their own independent judgment. Any decisions made by clients have nothing to do with SMM.]