Zambian Copper Smelter Plans to Halt Production, LME Copper and SHFE Copper Both Closed Lower Overnight [SMM Copper Morning Meeting Minutes]

2026.4.21 Tuesday
Futures: Overnight, LME copper opened at $13,237/mt, touched a low of $13,213/mt early in the session before the center fluctuated upward, reached a high of $13,330/mt and then began to fluctuate downward, ultimately closing at $13,245/mt, down 0.78%, with trading volume at 18,000 lots and open interest at 281,000 lots, up 478 lots from the previous trading day, indicating bears adding positions. Overnight, the most-traded SHFE copper 2606 contract opened at 102,500 yuan/mt, tested up to 102,830 yuan/mt early in the session, then copper prices dropped sharply to 102,280 yuan/mt, before fluctuating downward to ultimately close at 102,490 yuan/mt, down 0.13%, with trading volume at 31,000 lots and open interest at 199,000 lots, up 2,351 lots from the previous trading day, indicating bears adding positions.
[SMM Copper Morning Meeting Summary] News:
(1) On April 20 (Monday), two industry sources said Zambia's two largest copper smelters and sulphuric acid producers plan to carry out extended maintenance shutdowns later this year, which will further squeeze the country's copper production and the supply of sulphuric acid used for processing copper and cobalt. The Iran war has disrupted global supplies of this critical acid and other leaching chemicals, forcing mines in neighboring Congo (the world's largest cobalt producer and second-largest copper producer) to reduce usage or consider production cuts. Zambia's mining ministry said that as Africa's second-largest producer of critical metals needed for clean energy technologies, the country's copper smelters produce approximately 2 million mt of sulphuric acid annually, mainly as a by-product for use by local mines, with the surplus exported to the DRC. A Canada-based First Quantum Minerals representative in Zambia said the country's own sulphuric acid inventory had been severely depleted, and there was effectively no export capacity. Meanwhile, miners in the neighboring DRC were also struggling to cope with tightening chemical supply.
Spot:
(1) Shanghai: On April 20, the SHFE copper 2605 contract opened lower with a gap in the morning session before stabilizing and rebounding, then moved sideways with a fluctuating trend. The opening price was 102,780 yuan/mt. After opening, prices gapped lower and continued to decline, touching a low of 102,220 yuan/mt. After stabilizing, prices rebounded, rising to 102,930 yuan/mt, then edged down, ranging between 102,700 yuan/mt and 102,850 yuan/mt. Prices then rose again, reaching a high of 103,020 yuan/mt before pulling back slightly, with a closing price of 102,780 yuan/mt. The inter-month Contango price spread between futures contracts ranged between 160 yuan/mt and 120 yuan/mt. The import profit margin for SHFE copper against the 2605 contract for the current month ranged from a loss of 350 yuan/mt to 210 yuan/mt. Outlook for today: Shanghai spot copper premiums remain under pressure. Demand side, according to SMM, some downstream enterprises saw slight improvement in orders WoW, and end-user acceptance of current copper prices may have improved, with just-in-time procurement continuing. Market structure side, the inter-month Contango price spread between futures contracts widened slightly, and suppliers showed a tendency to hold prices firm; meanwhile, some suppliers chose to lower offer prices for shipments to control inventory levels, and market expectations for the outlook diverged. Inventory side, SMM data showed social inventory in the Shanghai area decreased by 5,400 mt WoW from last Thursday, and the Jiangsu area decreased by 6,700 mt, with the destocking pace continuing. Overall, under the combined effects of mild demand recovery, support from the price spread structure, and some selling pressure, Shanghai spot copper prices against the 2605 contract are expected to remain at a discount today.
(2) Guangdong: On April 20, Guangdong #1 copper cathode spot prices against the front-month contract: high-quality copper was quoted at a premium of 260 yuan/mt, up 10 yuan/mt from the previous trading day; standard-quality copper was quoted at a premium of 170 yuan/mt, unchanged from the previous trading day; SX-EW copper was quoted at a premium of 110 yuan/mt, unchanged from the previous trading day. The average price of Guangdong #1 copper cathode was 102,880 yuan/mt, up 840 yuan/mt from the previous trading day; the average price of SX-EW copper was 102,775 yuan/mt, up 835 yuan/mt from the previous trading day. Overall, the significant inventory decline failed to offset rising copper prices. Premiums today remained flat compared with last Friday, and overall trading activity was weak.
(3) Imported copper: On April 20, the average warrant price fell $1/mt from the previous trading day to $68/mt (price range: $64-72/mt); the average B/L price fell $1/mt from the previous trading day to $66/mt (price range: $62-70/mt); the average EQ copper (CIF B/L) price was unchanged from the previous trading day at $37/mt (price range: $32-42/mt). Quotes were based on cargoes arriving from late April to early-to-mid May.
(4) Secondary copper: On April 20, the futures closing price at 11:30 was 102,780 yuan/mt, up 590 yuan/mt from the previous trading day. The average spot premium was 20 yuan/mt, down 10 yuan/mt from the previous trading day. On April 20, copper scrap prices rose 100 yuan/mt MoM. The copper scrap sales sentiment index stayed flat at 2.71, while the procurement sentiment index fell to 2.28. The price difference between copper cathode and copper scrap was 1,911 yuan/mt, up 469 yuan/mt MoM. The price difference between copper cathode rod and secondary copper rod was 1,860 yuan/mt. According to an SMM survey, elevated copper prices prompted some copper scrap to flow back into the market. However, given the excessively high absolute prices, most secondary copper rod enterprises tended to seek lower-priced sources, and the copper scrap market maintained a tight supply-demand balance.
Prices: On the macro front, Trump stated that the ceasefire agreement would not be extended, and Iran also indicated no plan for a second round of negotiations. Meanwhile, the Strait of Hormuz was closed again, casting doubt on the US-Iran ceasefire prospects and intensifying wait-and-see sentiment in the market. Fundamentals side, on the supply side, imported copper arrivals increased marginally, while domestic copper arrivals remained tight due to smelter maintenance; on the demand side, downstream consumption pace slowed compared with the earlier period. Inventory side, as of Monday April 20, SMM copper inventories across major regions nationwide decreased 12.21% WoW. Overall, copper prices are expected to maintain a high-level fluctuating trend with narrow-range sideways movement today.
[The information provided is for reference only. This article does not constitute direct advice for investment research decisions. Clients should make prudent decisions and not replace their own independent judgment with this information. Any decisions made by clients are not related to SMM.]