Copper Inventory in Major Chinese Markets Down This week but will Grow Next Week

As of Friday April 7, SMM copper inventory across major Chinese markets stood at 202,300 mt, down 3,900 mt from Monday and up 400 mt from last Friday. Total inventories added 5,700 mt from pre-CNY levels, growing for two consecutive weeks. Compared with Monday, copper inventories fell across most regions. Total domestic inventories added 62,000 mt from 140,300 mt in the same period last year. Inventories in Shanghai are 35,300 mt higher than the same period last year, those in Guangdong are 5,700 mt higher, those in Jiangsu are 13,900 mt higher and those in Zhejiang increased 4,800 mt.

The inventory in Shanghai decreased by 5,200 mt to 119,000 mt compared with Monday, and the inventory in Jiangsu decreased by 1,500 mt compared with Monday. At the end of this week, as copper prices fell, the enthusiasm for downstream purchasing increased, accelerating inventory decline. The inventory in Guangdong increased slightly by 200 mt from Monday to 50,800 mt. Shipments arrival volume and shipments leaving Guangdong were basically the same this week. The reason for the obvious increase in inventory in Zhejiang was the increase in local registered warrants.

Smelters will step up shipments to warehouses given the spot quotes, so the total supply will increase next week. Consumption next week will underperform this week. To sum up, SMM expects supply to grow and demand to weaken next week. And inventory would grow further.