Copper Spot Trading will Probably be Limited by the Semi-annual Settlement Cycle Next Week

SHANGHAI, Jun 24 (SMM) - On June 24, spot premiums of copper cathode in the Shanghai market stood at 80-120 yuan/mt over the 2207 contract. The average premium was 100 yuan/mt, 5 yuan/mt higher than the previous trading day. The traded prices of standard-quality copper were 64,180-64,460 yuan/mt, and the high-quality copper was traded at 64,180-64,440 yuan/mt. The next-month SHFE copper contract continued to fall, and once dropped to the lowest of 63,600 yuan/mt. In the early trading, the prices rose slightly to above 64,000 yuan/mt and hovered around 64,200 yuan/mt.

In the spot market, the premiums were lowered by the downstream that purchased on dips. In the early trading, premiums of standard-quality copper dropped from 100 yuan/mt to around 90 yuan/mt. The spread between the high-quality copper and standard-quality copper stabilised at around premiums of 20 yuan/mt, and quotes for high-quality copper were 100-120 yuan/mt, which is still not favoured by the market. Hydro-copper was quoted at premiums of 20-40 yuan/mt, and the market was occupied by the non-standard and non-registered brands.

On the last trading day today before the delivery of long-term orders in June, the trading was picked up. Besides, the futures prices have dropped for nearly 10 trading days, and the downstream’s purchasing on dips enabled the premiums to stand at around 100 yuan/mt. In the semi-annual settlement cycle next week, traders will mainly intend to gain cash, and the premiums may hardly rise. Besides, the downstream restocking demand is poor, and the inflow of overseas sources suppresses the spot premiums to a certain extent.