Argentine Copper Project Halted, Raising Environmental Supply Risks

[SMM Shanghai Spot Copper] Looking ahead to tomorrow, from the perspective of regional price spreads, the intraday Shanghai-Guangdong price spread widened further compared to yesterday, reaching 200 yuan/mt, with the theoretical arbitrage window now open. According to SMM, some suppliers have already begun relocating cargo from Shanghai warehouses to the Guangdong region to capture regional price spread gains. If spot premiums in Guangdong continue to remain strong, cross-regional cargo transfers will effectively divert available cargo from the Shanghai market, potentially providing marginal support for local spot discounts or even boosting spot premiums in Shanghai and other regions. Demand side, after consecutive declines in copper prices, downstream procurement sentiment recovered slightly, but overall purchasing remained dominated by rigid demand. Overall, under the combined effects of cross-regional arbitrage diversion and support from the inter-month price spread structure, Shanghai spot copper is expected to maintain a discount against the 2605 contract tomorrow. Going forward, attention should be paid to the transmission effect of Guangdong premiums on the east China market.

Today, #1 copper cathode spot prices in North China against the front-month contract were reported at an average of a discount of 200 yuan/mt to a discount of 120 yuan/mt, with the average price down 10 yuan/mt from the previous trading day. The average transaction price was 101,950 yuan/mt, down 765 yuan/mt from the previous trading day.