SMM October 9 News:
Guangdong Region: Before the National Day holiday, copper prices had already surged significantly, leading most downstream copper enterprises in Guangdong to take holidays of 5–8 days during the holiday period. Upon returning from the holidays, inventory increased substantially, and suppliers had to sharply lower premiums to facilitate sales. As of Thursday, high-quality copper was quoted at a premium of 60 yuan/mt, down 60 yuan/mt from before the holiday; standard-quality copper was quoted at parity, down 60 yuan/mt from before the holiday; and SX-EW copper was quoted at a discount of 60 yuan/mt, down 60 yuan/mt from before the holiday. On Thursday, the price spread for standard-quality copper premiums and discounts between Shanghai and Guangdong was 70 yuan/mt higher in Guangdong, a relatively small difference that leaves no room for inter-regional transfers. According to SMM statistics, as of Thursday, total warehouse inventory in Guangdong was 21,700 mt, a sharp increase of 10,500 mt from before the holiday, with warrants totaling 6,500 mt, up 3,000 mt from before the holiday. Specifically: during the holiday period, warehouse arrivals reached 12,500 mt/week, while withdrawals from warehouses were only 2,100 mt/week.
Looking ahead to next week, imported copper arrivals are expected to be limited, while domestic copper arrivals are also expected to decrease due to production cuts at smelters, leading to an anticipated overall reduction in supply. On the downstream consumption side: downstream processing enterprises are gradually resuming production after the holiday, and consumption is expected to increase. Therefore, we believe that next week will see a scenario of reduced supply and increased consumption, with weekly inventory expected to decline again and spot premiums likely to fluctuate higher.
(The above information is based on market data collection and comprehensive evaluation by the SMM research team. The information provided herein is for reference only. This article does not constitute direct investment research advice. Clients should exercise caution in decision-making and not use this information to replace independent judgment. Any decisions made by clients are unrelated to SMM.)
