Spot quotes in north China fell last week. Spot copper was quoted with discounts of 40 yuan/mt to premiums of 200 yuan/mt, or an average premium of 80 yuan/mt last Friday, down 20 yuan/mt from May 19.
Last week, the inventory in Tianjin warehouses fell 500 mt due to large volumes of downstream purchases. At the beginning of the week, due to the inflow of goods under warrants and imported copper in Shanghai, spot premiums fell from high levels. Sellers held prices firm after copper prices fell to 63,000-64,000 yuan/mt.
However, the downstream was still bearish and took a wait-and-see attitude. Spot quotes stabilised. Due to the continuous decline in copper prices previously, orders at downstream copper rod factories surged, and supply of goods in north China was tight. This, combined with the nearing maintenance at a main smelter in north China, caused sellers to raise prices. Spot premiums rose on Friday.
This week, spot prices will remain at high levels in north China if copper prices remain low and due to tight supply.
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