BHP's Optimistic Annual Copper Production Expectations Drive LME Copper to Sharp Overnight Gains [SMM Copper Morning Meeting Minutes]

2026.4.23 Thursday
Futures: Overnight, LME copper opened at $13,299.5/mt, touched a low of $13,263/mt at the beginning of the session before the center fluctuated upward, reached a high of $13,480/mt near the end of the session, and finally closed at $13,470.5/mt, up 2.4%, with trading volume at 22,000 lots and open interest at 275,000 lots, down 4,026 lots from the previous trading day, indicating bears reducing positions. Overnight, the most-traded SHFE copper 2606 contract opened at 102,620 yuan/mt, touched a low of 102,490 yuan/mt at the beginning of the session, then the center rose to a high of 104,000 yuan/mt, and finally moved sideways to close at 103,900 yuan/mt, up 1.23%, with trading volume at 73,000 lots and open interest at 220,000 lots, up 15,806 lots from the previous trading day, indicating bulls adding positions.
[SMM Copper Morning Meeting Summary] News:
(1) BHP Group announced in its earnings report on Wednesday that annual copper production is expected to reach the upper half of its guidance range. The company stated that Q3 copper production fell 7% YoY to 476,800 mt, below the expected 479,200 mt, due to weak performance at its Escondida and Pampa Norte copper mine operations in Chile. Among them, Escondida copper mine production was 303,200 mt, down 9% YoY; Pampa Norte copper mine production was 44,600 mt, down 34% YoY. For FY2026 to date (through month-end of March), copper production was 1.4609 million mt, down 3% from the previous fiscal year. The company stated that annual copper production is expected to reach the upper half of the guidance range of 1.9-2 million mt.
Spot:
(1) Shanghai: On April 22, the SHFE copper 2605 contract opened higher in the morning session, pulled back, stabilized, and then rebounded again. The opening price was 102,010 yuan/mt. After opening, prices rose quickly to a high of 102,380 yuan/mt, then pulled back slightly with multiple rebounds, declining to 102,100 yuan/mt before stabilizing and rebounding, with a closing price of 102,330 yuan/mt. The inter-month Contango price spread ranged between 130 yuan/mt and 80 yuan/mt, and the import profit margin for SHFE copper against the 2605 contract for cargoes with invoices dated this month ranged from a loss of 200 yuan/mt to 140 yuan/mt. Looking ahead to today, from the perspective of regional price spreads, the intraday Shanghai-Guangdong price spread widened further to around 250 yuan/mt, with arbitrage opportunities expanding further. The willingness to divert east China cargoes to south China is likely to strengthen, which is expected to redirect available cargoes from the Shanghai market, providing marginal support for local spot discounts. In addition, cargoes with invoices dated this month are currently relatively scarce in the Shanghai spot copper market's trading segment, and some suppliers chose to make shipments using cargoes with invoices dated next month, with the price spread between cargoes with invoices dated this month and next month maintained at 30-40 yuan/mt. Demand side, with copper prices currently moving sideways, downstream enterprises' acceptance of current copper prices may have improved somewhat, with ordering willingness rebounding slightly, but still primarily driven by just-in-time procurement. Overall, under the combined effects of mild demand improvement, cross-regional arbitrage drivers, and invoice structure differentiation, spot prices against the SHFE copper 2605 contract are expected to remain at a discount today.
(2) Guangdong: On April 22, Guangdong #1 copper cathode spot prices against the front-month contract: high-quality copper was quoted at a premium of 310 yuan/mt, up 20 yuan/mt from the previous trading day; standard-quality copper was quoted at a premium of 230 yuan/mt, up 30 yuan/mt from the previous day; SX-EW copper was quoted at a premium of 170 yuan/mt, up 30 yuan/mt from the previous day. The average price of Guangdong #1 copper cathode was 102,455 yuan/mt, up 35 yuan/mt from the previous trading day, and the average price of SX-EW copper was 102,355 yuan/mt, up 40 yuan/mt from the previous trading day. Overall, with inventory hitting a new low for the year, suppliers actively held prices firm, and the overall trading atmosphere was better than the previous day.
(3) Imported copper: On April 22, the average warrant price was flat from the previous trading day at $68/mt (price range $63-73/mt); the average B/L price was flat from the previous trading day at $66/mt (price range $62-70/mt); the average EQ copper (CIF B/L) price was flat from the previous trading day at $37/mt (price range $32-42/mt), with quotes referencing cargoes arriving from late April to early-to-mid May.
(4) Secondary copper: On April 22 at 11:30, the futures closing price was 102,330 yuan/mt, up 380 yuan/mt from the previous trading day. The average spot premium was -5 yuan/mt, down 10 yuan/mt from the previous trading day. On April 22, copper scrap prices fell 200 yuan/mt MoM. The copper scrap sales sentiment index rose to 2.69, while the procurement sentiment index fell to 2.25. The price difference between copper cathode and copper scrap was 1,818 yuan/mt, up 752 yuan/mt MoM. The price difference between copper cathode rod and secondary copper rod was 1,590 yuan/mt. According to an SMM survey, although copper prices rose, copper scrap suppliers were constrained by a shortage of bills, and with relatively high copper scrap inventory levels leading to increased capital pressure, they had to slightly cut prices to facilitate shipments.
Prices: On the macro front, Trump extended the ceasefire agreement with Iran without setting a deadline for the extension; additionally, Trump claimed that a new round of US-Iran talks could resume as early as Friday, boosting market risk appetite and supporting copper prices. Fundamentals side, supply side, arrivals of imported copper increased somewhat, while domestic supply remained tight; demand side, affected by copper prices fluctuating at highs, downstream buyers mainly made just-in-time procurement. Overall, copper prices are expected to hold up well today.
[The information provided is for reference only. This article does not constitute direct advice for investment research decisions. Clients should make prudent decisions and not replace their own independent judgment with this information. Any decisions made by clients are not related to SMM.]