SMM Morning Meeting Minutes: Overnight LME copper opened at $13,604/mt, and amid wild swings at the beginning of the session, it dipped to a low of $13,590/mt. It then continued to swing wildly, rising to a high of $13,645/mt near the end of the session, and eventually closed at $13,644.5/mt, up 0.86%. Trading volume reached 15,600 lots, and open interest stood at 244,000 lots, down 1,039 lots from the previous trading day, indicating a reduction in bearish positions. Overnight the most-traded SHFE copper 2609 contract opened at 104,490 yuan/mt, and initially dipped to a low of 104,240 yuan/mt. It then drifted higher to touch a high of 104,680 yuan/mt, afterwards moving sideways, and finally settled at 104,480 yuan/mt, up 0.69%. Trading volume reached 33,800 lots, and open interest stood at 192,000 lots, up 1,706 lots from the previous trading day, indicating an increase in bullish positions.

SMM July 21 – Overnight, LME copper opened at $13,604/mt, swung wildly at the start and touched a low of $13,590/mt, then continued wild swings and near the close climbed to $13,645/mt, finally settling at $13,644.5/mt, up 0.86%. Trading volume reached 15,600 lots, and open interest stood at 244,000 lots, down 1,039 lots from the previous trading day, indicating short position reduction. Overnight, the most-traded SHFE copper 2609 contract opened at 104,490 yuan/mt, dipped to 104,240 yuan/mt shortly after opening, then drifted higher to touch a high of 104,680 yuan/mt, and later moved sideways. It eventually closed at 104,480 yuan/mt, up 0.69%. Trading volume reached 33,800 lots, and open interest stood at 192,000 lots, up 1,706 lots from the previous trading day, indicating long position addition. On the macro front, Iran said mediators proposed a 10-day US-Iran ceasefire to resume implementation of the memorandum of understanding, and it has received the proposal and indicated it may negotiate with the US based on national interests. The Houthis announced a maritime ban against Saudi Arabia, and Saudi Arabia said it is taking military action to ensure shipping safety in the Bab el-Mandeb Strait. US media reported that Trump is focused on making Iran "pay a price," but negotiations between the two countries continue. On the fundamentals side, supply side, available spot resources in China remained acutely tight, social inventory stayed at a low for the year, arrivals from cross-regional transfers were limited, and the tight spot situation is unlikely to ease in the short term. Demand side, the industry was in the traditional consumption off-season, downstream enterprises made sporadic need-to-basis purchases, and overall consumption was weak. Inventory side, as of Monday July 20, SMM copper inventories in major Chinese regions fell by 32,700 mt WoW to 107,300 mt. Continued destocking provided bottom support for copper prices. Overall, the tight supply and destocking trend continued, and copper prices are expected to drift higher today.

SMM, July 20: Data Summary: As of Monday, July 20, SMM copper inventories in major Chinese regions fell 32,700 mt WoW to 107,300 mt. Total inventories dropped 11,300 mt compared to 118,600 mt in the same period last year, with destocking observed across all regions. Specifically, Shanghai saw sustained destocking as domestic smelter maintenance has not fully concluded, dragging down domestic copper cathode arrivals, combined with fewer imported cargoes. Jiangsu was stable, with no significant inventory changes. In Guangdong, both supply and demand were sluggish; some spot cargoes flowed to east China markets, driving regional inventories lower in tandem. Market outlook: Supply side, arrivals of both imported and domestic copper cathode are unlikely to improve in the near term, keeping overall circulating supply tight; demand side, downstream performance remains weak during the off-season, limited to just-in-time procurement. Surveys indicate the copper cathode rod operating rate is expected to fall to 63.21% this week, down 1.89 percentage points WoW. Under the overall supply-demand pattern, with tight spot supply in China and insufficient downstream purchasing power, national copper cathode social inventory is expected to extend its destocking trend next week, though the pace of decline is likely to narrow.

SMM Analysis: Since late June, copper premiums cif China have been climbing. Spot premiums for registered copper arriving at China's ports from late July to August have recently breached triple digits, continuously setting new yearly highs...

SMM, July 17 – Overnight, LME copper opened at $13,615/mt, rose to touch a high of $13,630/mt in early trading, then drifted lower to $13,533/mt, and finally settled at $13,543.5/mt, down 0.28%. Trading volume was 12,000 lots, open interest reached 242,000 lots, down 2,906 lots from the previous trading day, indicating long liquidation. Overnight, the most-traded SHFE copper 2608 contract opened at 104,200 yuan/mt, edged up to 104,550 yuan/mt in early trading, then drifted lower to touch a low of 104,100 yuan/mt, and finally settled at 104,230 yuan/mt, down 0.2%. Trading volume reached 13,000 lots, open interest reached 132,000 lots, down 1,191 lots from the previous trading day, indicating long liquidation. On the macro front, the US-Iran conflict continued to escalate. Iran claimed that the Strait of Hormuz would not be reopened due to US pressure, and the Revolutionary Guard warned that if the US makes a strategic mistake, regional energy exports could be disrupted. Reports said Iran had secretly ordered the Houthis to blockade the Bab el-Mandeb Strait if the US strikes Iran’s power facilities. Meanwhile, the US military carried out airstrikes on airports and transport hubs inside Iran. The White House said Iran is still willing to talk, but there was no sign of a softening in Iran’s position. Overall, although Middle East tensions remain high, expectations of US economic resilience dominated short-term sentiment, and copper prices edged lower. On the fundamentals front, supply remained tight, with both imports and domestic output providing insufficient replenishment. Demand-side consumption was weak, and downstream users only made essential restocking purchases during the off-season. As of Thursday, July 16, SMM data showed that copper inventories in major Chinese markets fell by 41,600 mt WoW to 123,400 mt. Total inventories were 19,900 mt lower than the 143,300 mt recorded in the same period last year. Overall, copper prices are expected to drift slightly lower today.

SMM Morning Meeting Minutes: Overnight LME copper opened at $13,615/mt, initially rose to hit a high of $13,630/mt, then drifted lower to $13,533/mt, and finally closed at $13,543.5/mt, down 0.28%. Trading volume was 12,000 lots, open interest stood at 242,000 lots, down 2,906 lots from the previous trading day, indicating long liquidation. Overnight the most-traded SHFE copper 2608 contract opened at 104,200 yuan/mt, initially edged up to 104,550 yuan/mt, then drifted lower to touch a low of 104,100 yuan/mt, and finally closed at 104,230 yuan/mt, down 0.2%. Trading volume was 13,000 lots, open interest stood at 132,000 lots, down 1,191 lots from the previous trading day, indicating long liquidation.

SMM July 16 News: Data Briefing: As of Thursday, July 16, SMM copper inventories in major domestic regions decreased by 41,600 mt WoW to 123,400 mt, with total inventories down 19,900 mt YoY from 143,300 mt in the same period last year. Specifically, in Shanghai, arrivals of both imported and domestic copper contracted simultaneously, resulting in significant destocking; in Jiangsu, inventories continued to decline, driven by tighter domestic copper arrivals; in Guangdong, the scale of arrivals declined, and coupled with mediocre end-use demand, regional supply-demand conditions were weak, causing inventories to edge down. Looking ahead, supply side, near-term imported supply arrivals are limited, and domestic copper supply remains at a low level; demand side, the market is still in the traditional consumption off-season, with downstream enterprises largely maintaining a procure-as-needed pace. Currently, spot circulating cargo is tight overall, with transactions predominantly for immediate needs. Next week, national copper social inventories are expected to continue the destocking trend.

According to SMM statistics, as of July 16, social inventories of copper cathode in major Chinese regions fell to 123,400 mt, down by 16,600 mt from July 13. The recent destocking was mainly due to unplanned maintenance at some smelters, reduced domestic arrivals, and the diversion of overseas supply to the US market, while imported copper remained limited. In the secondary copper market, substitution of copper cathode was weak owing to compliance reviews on invoices. Although demand entered the traditional off-season, with downstream users making just-in-time procurement, the larger contraction in supply is expected to keep inventories low in the short term. Notably, the ratio of cancelled warrants in LME copper inventories has continued to rise recently, and some of the cancelled material has been arranged for shipment to China, indicating that low domestic inventories and tight spot supply are gradually attracting overseas material back. While demand is in the off-season and downstream users are making just-in-time procurement, the supply contraction has been more significant, and inventories are expected to remain low in the short term.

This week (July 13-16), the weekly average B/L transaction price range for Yangshan copper premiums was $84-95/mt, QP August, averaging $90/mt; the weekly average warrant transaction price range was $85-95/mt, QP August, averaging $90/mt; and EQ copper CIF B/L was $53-61/mt, QP August, averaging $57/mt. As of July 16, the ex-FX SHFE/LME copper price ratio for LME copper against the SHFE copper 2608 contract stood at 1.1426, with an import loss around 374.65 yuan/mt, widening from the prior period. As of Thursday, the LME copper front-end was in a contango structure, with the spread between the August and September dates at −$7.45/mt. Currently, mainstream offer indications for pyrometallurgical registered copper B/L are around $100-110/mt, and for EQ copper CIF B/L around $65-70/mt. This week, Yangshan copper premiums continued their upward momentum, still driven primarily by expectations of persistently tight market supply, which prompted suppliers to hold back from selling. Available cargoes were scarce during the week, and domestic social inventory continued destocking, giving upstream sellers strong confidence to hold prices firm. Spot premiums repeatedly hit new highs for the year, but downstream demand showed mediocre performance, with limited actual transactions. On the price ratio front, the ratio weakened over the week, yet sellers held an optimistic outlook for the near term. Overall, sellers’ firm pricing and downstream fear of high prices intertwined, presenting a weak supply-demand picture. According to SMM, as of Thursday (July 16), domestic bonded zone copper inventories increased by about 3,300 mt WoW from July 13 to 38,900 mt. Shanghai bonded inventory rose 2,900 mt WoW to 34,800 mt, and Guangdong bonded inventory rose 400 mt WoW to 4,100 mt. The bonded zone inventory shifted from destocking to buildup, mainly because some suppliers took an optimistic view on future premiums and the price ratio, showing low willingness to sell and leading to reduced warehouse withdrawals. Looking ahead, amid the siphoning effect from North America and production losses in Africa due to rising production costs, the market will continue to trade the tight availability of cargoes in the near term. However, it is worth noting that LME cancelled warrants have increased significantly recently, and according to SMM, some cargoes are already being shipped to China. Attention should be paid to the volume of this supply replenishment and the downstream's actual consumption capacity to absorb the high premiums.

SMM, July 14 – Overnight, LME copper opened at $13,445/mt, initially drifted higher to touch $13,571/mt, then edged down to $13,474/mt before closing at $13,479/mt, down 0.04%. Trading volume was 21,000 lots, and open interest reached 247,000 lots, down 172 lots from the previous trading day, reflecting a reduction in long positions. Overnight, the most-traded SHFE copper 2608 contract opened at 103,910 yuan/mt, edged up to 104,290 yuan/mt in early trading, then drifted lower to touch 103,610 yuan/mt before closing at 103,700 yuan/mt, up 0.58%. Trading volume was 36,000 lots, and open interest stood at 143,000 lots, up 768 lots from the previous trading day, reflecting an increase in long positions. On the macro front, US Fed Governor Waller said that if core inflation heats up again this week, the FOMC will have to consider tightening monetary policy in the near term. On the geopolitical front, Trump said on Monday that tonight and tomorrow the US would carry out severe strikes against Iran, aiming to destroy its underground nuclear facilities, but also mentioned the possibility of reaching a deal. Multiple areas in Iran continued to be hit, with Iran responding by attacking US military facilities. Yemen’s Houthi rebels and Saudi Arabia exchanged attacks, and Yemen’s capital international airport was struck by airstrikes. Escalating geopolitical conflicts, combined with rising inflation expectations, are keeping copper prices under pressure in the short term. On the fundamental side, supply remained tight overall, with limited imports and domestic arrivals, resulting in little incremental supply. Demand side, performance was weak. After copper prices pulled back, downstream buyers mainly engaged in restocking for immediate needs, with low purchase willingness. As of Monday, July 13, SMM copper inventories across major regions in China fell by 52,200 mt WoW to 140,000 mt. Total inventories were down by 7,600 mt compared to the same period last year from 147,600 mt, with all regions showing destocking. Overall, copper prices are expected to drift lower today.