Freeport Indonesia Copper Mine Production Resumption Delayed to 2028; LME Copper and SHFE Copper Both Closed Higher Overnight [SMM Copper Morning Meeting Minutes]

2026.5.11 Monday
Futures: Last Friday evening, LME copper opened at $13,522.5/mt, fluctuated downward to $13,484.5/mt at the beginning of the session, then swung wildly to touch a high of $13,583/mt, before fluctuating downward to finally close at $13,535.5/mt, up 1.59%, with trading volume at 29,500 lots and open interest at 271,000 lots, down 1,154 lots from the previous trading day, indicating short covering. Last Friday evening, the most-traded SHFE copper 2606 contract opened at 104,500 yuan/mt, immediately rose to 104,580 yuan/mt at the beginning of the session, then fluctuated downward to 103,690 yuan/mt, moved sideways near the end of the session and finally closed at 104,200 yuan/mt, up 0.53%, with trading volume at 50,000 lots and open interest at 208,000 lots, down 1,584 lots from the previous trading day, indicating short covering.
[SMM Copper Morning Meeting Summary] News:
(1) On May 8 (Friday), a spokesperson for Freeport Indonesia revealed that the company had adjusted its "production ramp-up" plan for the Grasberg Block Cave (GBC) underground copper mine, now expecting to fully resume operations in 2028. Freeport Indonesia spokesperson Katri Krisnati stated: "Following the mudslide incident in September last year, additional modifications to logistics and ore processing infrastructure were required at the underground mine, leading to an adjustment of the GBC copper mine's production resumption target." The Grasberg copper mine experienced a mudslide incident in September last year, and CEO Tony Wenas said at the time that the mine was not expected to return to full production until 2027. Friday's statement indicated that Freeport-McMoRan had pushed back the production resumption timeline for the Grasberg mine by one year, with the latest target being full production resumptions in early 2028.
Spot:
(1) Shanghai: On May 8, the SHFE copper 2605 contract showed multiple retreat after rapid rise patterns during the morning session. The opening price was 102,660 yuan/mt, after which prices touched a high of 102,840 yuan/mt, pulled back after multiple rallies, and the closing price was 102,770 yuan/mt. The inter-month Contango price spread ranged between 60 yuan/mt and 20 yuan/mt, and the import profit margin for SHFE copper against the 2605 contract ranged between a loss of 160 yuan/mt and a loss of 100 yuan/mt. Looking ahead to today, Shanghai spot copper premiums are expected to continue under pressure. Suppliers continuously lowered their offers during the day, with the premium center shifting notably downward, reflecting limited downstream acceptance of high copper prices and premiums, with purchases mainly driven by rigid demand. In addition, the Shanghai-Guangdong price spread stayed high, with theoretical arbitrage opportunities persisting, which may attract east China cargoes to be diverted to south China, diverting available spot cargoes from the Shanghai market and providing some support for local spot discounts. It is worth noting that this Friday is the delivery day for the 05 contract, with delivery logic gradually emerging, which may provide floor support for spot premiums. Overall, Shanghai spot copper premiums are expected to remain under pressure, but downside room is expected to be supported by delivery expectations.
(2) Guangdong: On May 8, Guangdong #1 copper cathode spot prices against the front-month contract: high-quality copper was quoted at 290 yuan/mt, up 20 yuan/mt from the previous trading day; standard-quality copper was quoted at a premium of 220 yuan/mt, up 30 yuan/mt from the previous trading day; SX-EW copper was quoted at a premium of 140 yuan/mt, up 30 yuan/mt from the previous trading day. The average price of Guangdong #1 copper cathode was 102,970 yuan/mt, down 55 yuan/mt from the previous trading day; the average price of SX-EW copper was 102,865 yuan/mt, down 50 yuan/mt from the previous trading day. Overall, declining inventory stimulated premiums to rise, but end-users maintained purchasing as needed, and overall trading activity remained subdued.
(3) Imported copper: On May 8, the average warrant price rose $1/mt from the previous trading day to $70/mt (price range $64-76/mt); the average B/L price rose $1/mt from the previous trading day to $67/mt (price range $63-73/mt); the average EQ copper (CIF B/L) price rose $1/mt from the previous trading day to $37/mt (price range $32-42/mt), with quotes referencing cargoes arriving in early-to-mid May.
(4) Secondary copper: On May 8, the 11:30 futures closing price was 102,770 yuan/mt, down 90 yuan/mt from the previous trading day. The average spot premium was 60 yuan/mt, down 20 yuan/mt from the previous trading day. On May 8, copper scrap prices fell 200 yuan/mt MoM. The copper scrap sales sentiment index rose to 2.58, and the purchasing sentiment index rose to 2.2. The price difference between copper cathode and copper scrap was 1,489 yuan/mt, up 113 yuan/mt MoM. The price difference between copper cathode rod and secondary copper rod was 1,350 yuan/mt. According to an SMM survey, the delayed production resumptions at Indonesian copper mines intensified global expectations of tight copper concentrates supply. Copper prices surged in response, and the copper scrap market prices became momentarily chaotic. Suppliers fearful of high prices rushed to make shipments, while traders who remained bullish on copper prices held firm. Deductions stayed at relatively low levels, and copper scrap transaction prices fluctuated erratically.
Prices: Macro perspective, US April non-farm payrolls added 115,000 jobs, significantly exceeding market expectations. The unemployment rate remained stable, but the consumer confidence index fell to a new phase low. The US Fed saw notable divergence in internal policy views — official Milan leaned toward initiating interest rate cuts earlier, while Goolsbee believed employment fundamentals remained solid and inflation trends were still negative. Geopolitical tensions continued to disrupt the market, as Iran formally rejected the US proposal, and the US stated it was unacceptable and issued tough deterrent rhetoric. Combined with mining supply disruption news, these factors jointly pushed copper prices higher. Fundamentals side, supply saw limited domestic arrivals, delayed imports, and a slight inventory increase but overall tightness; demand side, with copper prices continuing to fluctuate at highs, downstream enterprises maintained a cautious purchasing stance, and the market was primarily driven by rigid restocking needs. Overall, copper prices are expected to maintain a fluctuating trend within a narrow range today.
[The information provided is for reference only. This article does not constitute direct advice for investment research decisions. Clients should make decisions prudently and not replace their own independent judgment with this information. Any decisions made by clients are not related to SMM.]