SMM, December 19:
As of Thursday, December 19, SMM national mainstream copper inventories decreased by 4,400 mt from Monday to 98,700 mt, down by 23,600 mt WoW. Although this marked the ninth consecutive week of weekly destocking, the mid-week destocking speed slowed. Attention will focus on whether destocking can continue next week. Compared to Monday's inventory changes, inventories across all regions in the country declined. Total inventory was 42,100 mt higher YoY compared to 56,600 mt last year. Among them, Shanghai's inventory was 37,300 mt higher YoY, Jiangsu's was 13,000 mt higher, while Guangdong's was 7,500 mt lower.
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Specifically, Shanghai's inventory decreased by 2,500 mt from Monday to 70,200 mt, Jiangsu's inventory fell by 100 mt to 15,200 mt. Despite the arrival of imported copper, domestic copper arrivals were limited, and downstream consumption remained moderate, leading to a decline in inventories in east China. Guangdong's inventory decreased by 1,600 mt to 7,200 mt, with limited arrivals being the main reason for the decline. Additionally, recent signs of weakening downstream consumption in Guangdong were reflected in the region's daily outflows from warehouses, which remained at low levels.
Looking ahead, as smelters complete maintenance, production is expected to increase significantly. Attention should focus on domestic copper arrivals, especially as year-end approaches, when smelters are expected to face inventory clearance pressure. On the downstream consumption side, some end-user enterprises are expected to begin controlling cash flow and reducing production in late December, leading to a gradual pullback in consumption. Therefore, we believe that next week will see a scenario of increased supply and weakened demand, with weekly inventories likely to rise again.
