Spot quotes in north China fell slightly last week. Spot copper was quoted with discounts of 10 yuan/mt to premiums of 270 yuan/mt, or an average premium of 130 yuan/mt last Friday, down 10 yuan/mt from June 2. Last week, the inventory in Tianjin warehouses remained unchanged due to weak supply and demand as well as different opinions of buyers and sellers. The overall trading volume in north China was relatively quiet last week. Spot premiums rose and then fell.
During the week, due to the overhaul of several major smelters in north China, the overall tight supply of goods in the market failed to ease. Sellers thus kept prices firm. However, with the rebound of copper prices and weak consumption, downstream buying interest was low. The backwardation of the SHFE front-month copper contract over the SHFE next-month copper contract was around 200 yuan/mt at the end of the week and smelters lowered prices before the delivery of the SHFE front-month copper contract.
Spot premiums in north China began to fall. Copper rod plants have basically completed delivery taking of goods bought previously at low prices. If the shortage of supply eases and the strong copper price continues to depress consumption, spot premiums in north China are expected to continue to fall this week.
