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China May Copper Imports Hit Record for 4th Month

Preliminary Import and Export Data for Base Metals in May

HONG KONG, June 11 -- China's May imports of unwrought copper and semi-finished copper products hit a fresh high for the fourth straight month on continued arbitrage trade, though domestic consumption waned ahead of low seasonal demand in the summer.
&nbsp;&nbsp;&nbsp; Imports of unwrought aluminium and semi-finished aluminium products in May dropped 24.6 percent on the month due to reduced arrivals of booked arbitrage imports for primary aluminium after record inflows in April.
&nbsp;&nbsp;&nbsp; China, the world's top consumer of copper and aluminium, imported 422,666 tonnes of unwrought copper, including anode, refined and alloy, and semi-finished products, in May, up 5.7 percent from April's record 399,833 tonnes, data from the General Administration of Customs showed on Thursday.
&nbsp;&nbsp;&nbsp; 'Even by Chinese standards, the numbers are very strong,' said David Moore, a commodities strategist at Commonwealth Bank in Sydney. 'Year-to-date imports are immense. There are a number of factors driving that, that is, restocking, reduced scrap -- but it's still a strong number and has been supportive of prices.'
&nbsp;&nbsp;&nbsp; But high margins were the key, said Liang Zhigang, analyst at Minmetals Starfutures in Shenzhen.
&nbsp;&nbsp;&nbsp; 'Import margins reached the highest level this year in mid-April and that should have boosted order placing. May's high arrivals reflected that increased booking,' said Liang, who estimated more than 300,000 tonnes of refined copper included in the May imports.
&nbsp;&nbsp;&nbsp; Based on the ratio of refined copper to total imports in April, refined copper data, which is an indication of domestic consumption and will be announced in late June, could show refined copper inflows of 336,019 tonnes in May, more than the 300,000 tonnes traders had forecast and surpassing April's record of 317,947 tonnes.
&nbsp;&nbsp;&nbsp; 'But demand has slowed as the seasonal low season is coming,' said Zhu Yanzhong, analyst at Jinrui Futures, a subsidiary of top Chinese copper smelter Jiangxi Copper.
&nbsp;&nbsp;&nbsp; Zhu said the demand fall from manufacturers of home appliances was less than other industries, probably a result of Beijing's policy to provide subsidies to farmers' purchases of such commodities to boost domestic consumption.
&nbsp;&nbsp;&nbsp; But that would not be enough to offset reduced demand from other end-users, which could cut imports in June, Zhu predicted.
&nbsp;&nbsp;&nbsp; He added end-users were also not keen to buy copper due to mixed signals on domestic consumption.
&nbsp;&nbsp;&nbsp; China imported 331,740 tonnes of unwrought aluminium, including primary metal and alloy, and semi-finished products in May, down from April's multi-year high. China is the world's top aluminium producer.
&nbsp;&nbsp;&nbsp; Based on April's ratio of primary aluminium to total imports, May's data could show primary aluminium imports of 273,354 tonnes, down from April's record 362,400 tonnes.
&nbsp;&nbsp;&nbsp; Traders had expected primary aluminium imports of 200,000-250,000 tonnes in May. Data on primary metal, an indication of Chinese consumption, will be released in late June.
&nbsp;&nbsp;&nbsp; But Chinese buyers have increased orders for spot imports of primary aluminium over the past two weeks, which could boost imports in June, traders and smelter officials said.
&nbsp;&nbsp;&nbsp; 'May's arrivals were mostly previous months' orders. But Chinese orders are rising again as domestic prices rise,' said an aluminium trader, who expected June's imports to hit 300,000 tonnes.
&nbsp;&nbsp;&nbsp; (Source: Reuters)
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