Kazakhstan's Copper Cathode Production Declined in January-February, Overnight LME Copper and SHFE Copper Closed Sharply Lower [SMM Copper Morning Meeting Summary]

Thursday, March 19, 2026
Futures: Overnight, LME copper opened at $12,714.5/mt and climbed to $12,715/mt at the start of the session. Copper prices then saw the center move sharply lower, before fluctuating rangebound and eventually closing at $12,340/mt, down 3.44%. Trading volume reached 33,600 lots, and open interest stood at 288,300 lots, down 4,872 lots from the previous trading day, mainly due to long liquidation. Overnight, the most-traded SHFE copper 2605 contract opened at and touched a high of 98,000 yuan/mt. Copper prices then saw the center move sharply lower to a low of 95,920 yuan/mt, before fluctuating upward and finally closing at 96,340 yuan/mt, down 2.58%. Trading volume reached 103,000 lots, and open interest stood at 198,000 lots, up 9,911 lots from the previous trading day, mainly due to short buildup.
[SMM Copper Morning Meeting Summary] News:
(1) Data released by Kazakhstan's Bureau of National Statistics showed that Kazakhstan's refined copper production fell 9.1% YoY in January-February 2026. Refined copper: February 2026 production was 35,625 mt, down 7.8% MoM; total production in January-February was 74,266 mt, down 9.1% YoY. Refined zinc: February 2026 production was 15,105 mt, down 25.4% MoM; total production in January-February was 35,363 mt, down 12.0% YoY. Alumina and unwrought aluminum: February 2026 production was 109,895 mt, down 21.7% MoM; total production in January-February was 250,287 mt, down 14.9% YoY.
Spot:
(1) Shanghai: On the morning of March 18, the SHFE copper 2604 contract showed repeated price rises and pullbacks, with the closing price probing a low. It opened at 99,200 yuan/mt, rose after the opening to a high of 99,450 yuan/mt, then pulled back to 98,870 yuan/mt. Prices then stabilized and rose slightly to 99,250 yuan/mt, before falling again. By the close, prices had dropped to 98,660 yuan/mt. The price spread between futures contracts for nearby months ranged from Contango 50 yuan/mt to Backward 10 yuan/mt, while the import profit margin for front-month SHFE copper ranged from a profit of 20 yuan/mt to a profit of 100 yuan/mt. Intraday trading in the spot market improved from yesterday. Suppliers still showed willingness to hold prices firm, but some suppliers' sell-offs temporarily weighed on the market, causing spot premiums to decline somewhat in the second trading session. Coupled with the narrowing Contango spread between nearby contracts, suppliers' willingness to ship to delivery warehouse weakened somewhat, and spot premiums remained under pressure. Demand side, as copper prices fell, downstream enterprises may have had some restocking demand, but the actual attractiveness of current copper prices remained limited. Supply side, social inventory remained high, but actual circulating cargo was relatively tight. Some warrants were already seen flowing out during the day, which may ease some pressure on spot supply. Meanwhile, the import window remained open, and expectations for subsequent inflows of cargo from outside China heated up. Overall, amid the tug-of-war between sellers and buyers, Shanghai spot copper is expected to maintain the current discount pattern overall today.
(2) Guangdong: On March 18, Guangdong spot prices for #1 copper cathode against the front-month contract were reported at a premium of 50 yuan/mt for high-quality copper, up 20 yuan/mt from the previous trading day; a discount of 60 yuan/mt for standard-quality copper, up 20 yuan/mt from the previous trading day; and a discount of 120 yuan/mt for SX-EW copper, up 20 yuan/mt from the previous trading day. The average price of #1 copper cathode in Guangdong was 99,135 yuan/mt, down 1,120 yuan/mt from the previous trading day, while the average price of SX-EW copper was 99,020 yuan/mt, down 1,120 yuan/mt from the previous trading day. Overall, both copper prices and inventory declined, suppliers actively held prices firm while making shipments, and spot trades were better than the previous trading day.
(3) Imported copper: On March 18, the average warrant price was unchanged from the previous trading day at $47/mt (price range $42-52/mt); the average B/L price was unchanged from the previous trading day at $46/mt (price range $41-51/mt); and the average EQ copper (CIF B/L) price was unchanged from the previous trading day at $25/mt (price range $19-31/mt), with quotations referencing cargoes arriving from late March to mid-April.
(4) Secondary copper: At 11:30 on March 18, the futures closing price was 98,660 yuan/mt, down 1,470 yuan/mt from the previous trading day, while the average spot premiums stood at -90 yuan/mt, up 10 yuan/mt from the previous trading day. On March 18, copper scrap prices fell 700 yuan/mt MoM, the copper scrap sales sentiment index dropped to 2.34, the purchase sentiment index fell to 2.41, and the price difference between copper cathode and copper scrap was -1 yuan/mt, down 690 yuan/mt MoM. The price difference between copper cathode rod and secondary copper rod was 275 yuan/mt. According to the SMM survey, copper prices extended the recent downtrend, and suppliers’ reluctance to sell led to undersupply of copper scrap in China. Copper scrap prices showed strong resilience to declines, while downstream demand for tax-included copper scrap continued to increase. Prices for the invoice tax rate on domestically produced tax-included copper scrap kept rising and had now climbed to 9.5%-10.5%. Specifically, on March 18, the tax-included price of copper cathode was 98,570 yuan/mt, down 1,760 yuan/mt from yesterday, while the tax-included price of copper scrap was 98,571 yuan/mt, down 770 yuan/mt from yesterday. The tax-included price of copper scrap even exceeded the spot copper cathode price, with the intraday price difference between copper cathode and copper scrap recorded at -1 yuan/mt.
Prices: On the macro front, the US Fed kept interest rates unchanged, while the dot plot turned hawkish and market expectations for interest rate cuts cooled sharply. Powell said the current situation was not stagflation and that the energy shock was a one-off event. US PPI growth accelerated beyond expectations to 3.4% YoY. Tensions in the Middle East continued to escalate, with Israel killing Iran’s intelligence minister and striking targets in northern Iran, while Iran retaliated by attacking energy facilities in Qatar and Saudi Arabia. Geopolitical conflict pushed oil prices higher, intensified inflation risks, and drove up the US dollar index, weighing on copper prices. Fundamentally, arrivals of both imported and domestic copper remained stable, and overall supply was ample. Demand side, affected by the pullback in copper prices, downstream purchase willingness rebounded somewhat. Overall, macro headwinds dominated market sentiment, and copper prices are expected to continue fluctuating rangebound in the doldrums today.
[The information provided is for reference only. This article does not constitute direct advice for investment research decisions. Clients should make decisions prudently and should not use this to replace their own independent judgment. Any decisions made by clients are unrelated to SMM.]