Today, SMM #1 copper cathode spot prices against the current month SHFE 2606 contract were quoted at a discount of 100 yuan/mt to a premium of 30 yuan/mt, with an average quote at a discount of 35 yuan/mt. During the morning session, the SHFE copper 2606 contract showed a pattern of sideways consolidation followed by a rally, then a decline and rebound. The opening price was 103,670 yuan/mt. After the open, prices edged down to 103,460 yuan/mt, then rose somewhat, fluctuating between 103,500-103,800 yuan/mt. Copper prices then pulled back, touching a low of 103,010 yuan/mt, before stabilizing and rebounding, with a closing price of 103,300 yuan/mt. The inter-month Contango price spread between futures contracts ranged from 60-10 yuan/mt. The SHFE copper import profit margin against the 2606 contract ranged from a loss of 160 yuan/mt to a loss of 90 yuan/mt.
Intraday, the selling sentiment for copper cathode in Shanghai was 2.7, down 0.05 MoM, and the purchasing sentiment was 2.65, down 0.04 MoM. Historical data can be accessed via the database. At the start of the morning session, suppliers offered standard-quality copper at a discount of 100-50 yuan/mt, with SPCC-ILO, Lufang, Xiangguang, and JCC quoted at a discount of 80-50 yuan/mt, and Tiefeng, Jinfeng, Zhongtiaoshan, Dajiang PC, Dajiang HS, and Jinchuan ISA Yongchang quoted at a discount of 100-70 yuan/mt. High-quality copper was in scarce supply, so quotes remained firm, with Guiye quoted at a premium of 50 yuan/mt, and Jintun (plate) and Jinchuan (plate) quoted at a premium of 10 yuan/mt. In the second trading session, suppliers slightly lowered prices on some cargoes. Standard-quality copper was traded at a discount of 110-80 yuan/mt, high-quality Guiye copper was traded at parity to a premium of 30 yuan/mt, and non-registered copper was traded at a discount of 220-200 yuan/mt.
Outlook for tomorrow: Demand side, according to SMM, although copper prices retreated after a rapid rise, absolute prices remain at elevated levels. End-user cargo pick-up has slowed down. Affected by the buildup of finished product inventories, some copper semis processing plants in east China have opted to shut down furnaces for maintenance or close some production lines to reduce the capital occupation risk from high finished product inventories. Overall, amid weak demand, Shanghai spot copper premiums against the 06 contract are expected to remain at a discount tomorrow, potentially widening slightly.
