SHFE copper opened slightly higher in the morning, with intraday gains further expanding, closing up 1.17%. US copper remained firm, supported by tight ore supply, while domestic copper social inventories continued to decline, pushing the center of copper prices higher. However, attention should be paid to demand performance and the realization of positive factors. Recently, US copper has remained strong, supported by expectations of potential US tariff hikes on copper. On the raw material side, as of last week, domestic copper concentrate spot TCs continued to decline, with extremely low TCs exacerbating cost pressures on smelters. Market concerns persist that tight ore supply could transmit to the ingot end, continuing to support copper prices. Minmetals Futures noted that market expectations for US tariff hikes are strong, maintaining a high price spread between US copper and LME copper. Due to the uncertainty surrounding the extent of tariff hikes, copper price volatility risks remain. Copper concentrate TCs continue to decline, with no signs of stabilization yet. The ongoing competition between copper ore inventory exports from Indonesia and Panama and smelter maintenance persists. Overall, copper prices still have the potential to rise further, but as prices climb, caution is warranted regarding negative feedback from consumption and the risks associated with the realization of positive factors after US tariff hikes. Recently, LME copper inventories have continued to deplete, with the latest inventory falling to around 220,000 mt, while the cancellation ratio remains at a high level. Domestic refined copper social inventories also show a continuous downward trend, below the same period last year. However, the center of copper prices has been rising recently, with downstream consumption sentiment cooling slightly and spot premiums adjusting downward. Everbright Futures noted that some traders, attracted by high premiums and demand in Southeast Asia, are actively seeking FOB supplies from smelters, but domestic downstream consumption lacks support.

[SMM Analysis: What Are the Impacts of the Negative Era of Spot Copper Concentrate TCs?] On January 24, 2025, the SMM Imported Copper Concentrate Index (weekly) stood at -$2.2/mt, marking the second time since May 2024 that the TC value has turned negative. Unlike previous instances where the TC dipped below zero temporarily, this time it is highly likely to be a long-term situation.

Since July, SMM copper concentrate spot TC index has continuously rebounded.

On July 12, the SMM Imported Copper Concentrate Index (weekly) was $3.24/mt, an increase of $2.11/mt WoW. The pricing coefficient for domestic ore with a grade of 20% was 91%-93%.

As of Friday June 30, the SMM Imported Copper Concentrate Index (weekly) stood at $91.53/mt, $0.43/mt higher than June 21. During the week, spot trades of copper concentrate cooled down. SMM learned that one smelter and a trader traded 10,000 mt of clean ore scheduled for August with TCs of $90/mt.