SMM, September 29: Overnight, both LME copper and SHFE copper closed lower, with both showing long liquidation. Macro-wise, rising oil prices intensified inflation concerns, coupled with hawkish expectations from the US Fed. Copper prices are expected to consolidate on a subdued note within a narrow range today.
1. Overnight Futures
LME copper: Opened at $14,478/mt, hit a high of $14,481/mt, a low of $14,396/mt, and closed at $14,478/mt, down 1.05%. Trading volume was 19,000 lots, with open interest at 260,000 lots, down 2,650 lots from the previous trading day, as longs reduced positions.
The most-traded SHFE copper 2611 contract: Opened at 109,260 yuan/mt, hit a high of 109,370 yuan/mt, a low of 108,970 yuan/mt, and closed at 109,260 yuan/mt, down 0.16%. Trading volume was 31,000 lots, with open interest at 184,000 lots, down 1,545 lots from the previous trading day, as longs reduced positions.
2. Macro Front
The US rejected Iran's proposed peace deal, which was aimed at resolving the conflict between the two sides and reopening the Strait of Hormuz. The news pushed oil prices higher, reigniting concerns over rising US inflation. Combined with Fed officials maintaining a hawkish stance, the US dollar index closed higher, weighing on copper prices.
3. Fundamentals
Supply side, arrivals of both domestic and imported cargoes increased, easing the tightness in spot supply. Demand side, pre-holiday stockpiling has largely been completed, and with high premiums acting as a deterrent, downstream purchase willingness remained subdued.
Inventory-wise, as of Monday, September 28, SMM copper inventories across major Chinese regions rose 3,500 mt WoW to above 70,000 mt, while total inventories were 70,000 mt lower than the 140,000 mt level seen in the same period last year.
![SHFE copper closed, lacking SHFE guidance; LME copper under pressure [SMM Copper Morning Meeting Summary]](https://imgqn.smm.cn/usercenter/LbxVx20251217171714.jpeg)
