Anglo American Reports 15% Decline in Copper Production in Q1

Despite rebounding copper prices, Asian spot scrap supply remains tight, with pricing coefficients unexpectedly firm (Bare Bright holding around 98.5%). Concurrently, Western spot offers are shrinking. As the Aurubis Richmond smelter absorbs ~180,000 tonnes annually and US domestic cable shredding capacity rapidly expands, both the volume and quality of US scrap exports to Asia are declining. This structural shift is slashing transoceanic trade, accelerating the era of "regional circulation" for recycled copper. Currently, the squeeze primarily hits intermediate traders with sluggish volumes, while downstream end-consumers report limited immediate impact.

Looking ahead to next week, on the supply side, some delivery warrants have already begun to flow out during the day, suppressing spot premiums. Market concerns over the concentrated release of warrants going forward persist, and suppliers have a strong willingness to sell, putting spot premiums for SHFE copper under pressure. On the demand side, and downstream procurement was mainly driven by rigid demand, with insufficient willingness to chase higher prices. In addition, the spot premium price spread between Shanghai and Guangdong continued to rise to around 150 yuan/mt during the day. The strong premiums in Guangdong may provide some support to Shanghai market sentiment, but it is difficult to reverse the overall weak supply-demand pattern in the short term.