Copper Prices Rose Sharply but Suppliers Still Actively Held Prices Firm, Spot Premiums Stayed High [SMM South China Copper Cathode Spot Weekly Review]

SMM May 14 Update:

Guangdong region: Premiums in this region fluctuated at highs this week. Although copper prices surged significantly, suppliers maintained a bullish stance on premiums and were unwilling to lower prices for shipments, keeping premiums firm. As of Thursday, high-quality copper was quoted at 270 yuan/mt, on par with last Thursday; standard-quality copper premiums were quoted at 200 yuan/mt, up 10 yuan/mt from last Thursday; SX-EW copper was quoted at 130 yuan/mt, up 10 yuan/mt from last Thursday. On Thursday, the price spread of standard-quality copper premiums between Shanghai and Guangdong showed Guangdong higher by 280 yuan/mt. Given the large price spread, cargoes from Jiangxi and Hunan moved southward. According to SMM statistics, as of Thursday, total inventory in Guangdong warehouses was 16,800 mt, down 1,500 mt from last Thursday, with warrants totaling 5,100 mt, up 675 mt from last Thursday. Specifically: Arrivals at warehouses this week were 13,000 mt/week, up 1,100 mt/week WoW, below the annual average (14,000 mt/week); increased arrivals from northern sources were the main reason. Warehouse withdrawals were 14,800 mt/week, up 3,600 mt WoW, slightly above the annual average (14,200 mt/week). As downstream restocking before the holiday was limited, end-user enterprises began restocking after the holiday, driving up warehouse withdrawals.

Looking ahead to next week, as copper prices hover at historical highs, end-user cargo pick-up enthusiasm declined notably this week, and finished product inventories at many copper processing enterprises increased. Production cuts are expected next week. Therefore, inventory is expected to edge up next week, and premiums are expected to hover at highs without further climbing.

(The above information is derived from market data collection and comprehensive assessment by the SMM research team. The information provided in this article is for reference only. This article does not constitute direct advice for investment research decisions. Clients should make prudent decisions and not replace independent judgment with this information. Any decisions made by clients are not related to SMM.)