Copper Prices Surged Significantly While Premiums Retreated After Rapid Rise; Focus on Southbound Supply Volume [SMM South China Copper Cathode Spot Weekly Review]

SMM April 23 Update:

Guangdong region: Premiums in this region showed a trend of retreating after rapid rise this week. At the beginning of the week, premiums continued to rise as inventory hit new lows, but as copper prices surged significantly, downstream restocking willingness declined and premiums pulled back accordingly. As of Thursday, high-quality copper was quoted at 290 yuan/mt, up 80 yuan/mt WoW; standard-quality copper premiums were quoted at 210 yuan/mt, up 80 yuan/mt WoW; SX-EW copper was quoted at 150 yuan/mt, up 80 yuan/mt WoW. On Thursday, the price spread of standard-quality copper premiums between Shanghai and Guangdong showed Guangdong was 230 yuan/mt higher. Given the large price spread, there was no cross-regional cargo transfer this week, and cargo from Jiangxi and Fujian in particular moved southward. According to SMM statistics, as of Thursday, total warehouse inventory in Guangdong was 15,000 mt, down 8,300 mt WoW, with the decline showing a slowdown. Warrants totaled 5,500 mt, down 5,700 mt WoW. Specifically: Weekly warehouse arrivals were 7,500 mt/week, up 850 mt/week WoW, far below the annual average (14,000 mt/week), mainly due to increased cargo from the north. Warehouse withdrawals were 15,900 mt/week, down 2,400 mt/week WoW, slightly above the annual average (14,200 mt/week), as consumption declined after copper prices rose.

Looking ahead to next week, arrivals are expected to continue to increase, but consumption is expected to decline. Therefore, next week is expected to see weakness in both supply and demand, and inventory is expected to edge up.

(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.)