SMM News, March 5: Data Brief: As of Thursday, March 12, SMM copper inventories in major regions nationwide fell 0.57% WoW from last Thursday, ending the inventory buildup seen over the previous three consecutive weeks; total inventories increased 218,400 mt YoY from the same period last year, while regional performance remained differentiated. By region, copper cathode inventory in Shanghai continued to build up. Although consumption recovered somewhat, inventories still trended upward due to the impact of concentrated arrivals of imported cargoes and delivery factors; in Jiangsu, inventories declined slightly, supported by recovering downstream consumption; in Guangdong, consumption rebounded significantly and warehouse withdrawals increased, with inventories already reaching an inflection point and expected to continue declining going forward. Looking ahead, on the supply side, imported cargoes continued to arrive at port and domestic arrivals remained steady; on the demand side, downstream enterprises fully resumed production, and consumption recovered markedly. Based on the overall supply-demand pattern, supply is expected to remain normal next week while consumption steadily rebounds, and weekly copper cathode inventories are expected to destock somewhat.

SMM Morning Meeting Summary: Overnight, LME copper opened at $13,044/mt. It touched a high of $13,063.5/mt in early trading, then the center moved lower to a low of $12,929/mt, and finally closed at $12,948.5/mt, down 0.77%. Trading volume came in at 17,000 lots, down 235 lots from the previous trading day; open interest stood at 304,000 lots, up 279 lots from the previous trading day, mainly reflecting an increase in bears' positions overall. Overnight, the most-traded SHFE copper 2604 contract opened at 101,240 yuan/mt. It touched a high of 101,240 yuan/mt at the open, then the center moved lower to a low of 100,560 yuan/mt, and finally closed at 100,860 yuan/mt, down 0.15%. Trading volume came in at 26,000 lots, down 62,000 lots from the previous trading day; open interest stood at 189,000 lots, down 3,320 lots from the previous trading day, mainly reflecting a reduction in bulls' positions overall.

Supported by a relatively large volume of orders taken last week and a full production schedule, the operating rate of the enamelled wire industry increased WoW this week (March 6–March 12).....

SMM, March 12: Guangdong: Spot premiums in the region continued to rise this week. Lower copper prices, coupled with an increase in terminal orders, lifted consumption among copper processing enterprises, driving inventory lower and supporting higher spot premiums. As of Thursday, high-quality copper was quoted at 160 yuan/mt, up 160 yuan/mt from last Thursday; standard-quality copper was quoted at a premium of 40 yuan/mt, up 240 yuan/mt from last Thursday; and SX-EW copper was quoted at a discount of 20 yuan/mt, up 240 yuan/mt from last Thursday. On Thursday, the price spread in standard-quality copper premiums between Shanghai and Guangdong stood at 0 yuan/mt. With the spread relatively small, there was no cross-region cargo transfer. According to SMM statistics, as of Thursday, total inventory in Guangdong warehouses was 90,800 mt, down 6,300 mt from last Thursday. Warrants totaled 51,300 mt, down 1,500 mt from last Thursday. As spot cargo supply decreased and discounts turned into premiums, warrants began flowing into the market. Specifically, warehouse arrivals this week were 13,100 mt/week, down 2,500 mt/week WoW and slightly below the annual average of 14,000 mt/week. Arrivals of both imported copper and domestic copper declined WoW this week. Warehouse withdrawals were 20,200 mt/week, up 8,600 mt/week WoW and far above the annual average of 14,200 mt/week. After the Lantern Festival, downstream enterprises fully resumed operations. In addition, many enterprises had not stockpiled much before the holiday, and actively replenished inventory after the holiday while copper prices remained low. Looking ahead to next week, although delivery is approaching, spot cargo has already shifted to premiums. Suppliers are expected to show weaker willingness to deliver cargo to warehouses for delivery, and imported copper arrivals have also not increased. Total supply is expected to be slightly lower than this week. On the demand side, demand is expected to remain at this week's high level. Therefore, inventory is expected to remain in a state where demand exceeds supply next week, with inventory fluctuating lower, and spot premiums are expected to continue rebounding. (The above information is based on market collection and the comprehensive assessment of the SMM research team. The information provided in this article is for reference only. This article does not constitute direct advice for investment research decisions. Clients should make decisions prudently and should not use this as a substitute for their own independent judgment. Any decisions made by clients are unrelated to SMM.)

SMM, March 12: Today in Guangdong, spot premiums and discounts for #1 copper cathode against the front-month contract were reported at 160 yuan/mt, up 10 yuan/mt, for high-quality copper; 40 yuan/mt premium, up 20 yuan/mt, for standard-quality copper; and 20 yuan/mt discount, up 20 yuan/mt, for SX-EW copper. The average price of Guangdong #1 copper cathode was 100,860 yuan/mt, down 475 yuan/mt from the previous trading day, while the average price of SX-EW copper was 100,740 yuan/mt, down 470 yuan/mt from the previous trading day. Spot market: Today, Guangdong inventory continued to decline, with the drop widening, mainly due to increased warehouse withdrawals. As inventory kept falling and copper prices moved lower, suppliers actively held prices firm, and the price of standard-quality copper rose 20 yuan/mt from yesterday. However, downstream enterprises were less active in restocking than yesterday, and suppliers reported greater difficulty in making shipments than yesterday, with overall trading sentiment weaker than yesterday. Today, procurement sentiment for copper cathode in Guangdong was 2.51, down 0.23 from the previous trading day, while shipment sentiment was 3.57, up 0.15 from the previous trading day (historical data is available in the database). Overall, inventory continued to decline and copper prices moved lower, prompting suppliers to actively hold prices firm, but downstream procurement was weaker than yesterday, and overall trading was average.

[SMM Tin Morning Briefing: The Most-Traded SHFE Tin Contract Opened Sharply Lower in the Night Session and Remained Rangebound at Low Levels, While Trading in the Spot Market Was Relatively Mediocre]

The most-traded BC copper 2604 contract opened at 89,120 yuan/mt today. Early in the session, the center of copper prices gradually moved higher and rose to 89,950 yuan/mt, then fluctuated in wide swings. After the daytime session opened, the center of copper prices fell sharply to a low of 88,920 yuan/mt, then fluctuated upward and finally closed at 89,400 yuan/mt, down 0.71%. Open interest reached 5,673 lots, an increase of 123 lots from the previous trading day, while trading volume totaled 3,831 lots, indicating short position buildup by bears. From a macro perspective, the US February CPI rose 2.4% YoY, in line with market expectations. Although Trump said the war was expected to end quickly, uncertainty in the Middle East still remained, and the market stayed alert to escalating conflict. The US dollar index edged up, weighing on copper prices. Fundamentals side, supply was ample due to the impact of concentrated arrivals of imported cargoes and delivery factors, while downstream rigid demand was gradually released on the demand side. As of March 12, SMM copper inventories in major regions nationwide fell 0.57% from before the Chinese New Year. The SHFE copper 2604 contract closed at 101,010 yuan/mt. Based on the BC copper 2604 contract price of 89,400 yuan/mt, its after-tax price was 101,022 yuan/mt. The price spread between the SHFE copper 2603 contract and BC copper was -12, and the inverted spread remained in place but narrowed significantly from the previous day.

In North China today, spot #1 copper cathode was quoted at discounts of 20 yuan/mt to premiums of 100 yuan/mt against the front-month contract, with the average premium up 80 yuan/mt from the previous trading day. The average transaction price was 100,625 yuan/mt, down 610 yuan/mt from the previous trading day.

【SMM Copper Inventory Flash】 Over the weekend, social inventory in China’s major copper cathode regions continued to see a slight inventory buildup, but the pace of accumulation narrowed. On the demand side, consumption recovered somewhat, driven by the pullback in copper prices and the resumption of work and production downstream; however, imported cargoes continued to arrive at ports, and incremental supply on the supply side still pushed inventories higher.

[SMM Tin Morning Brief: The Most-Traded SHFE Tin Contract Rebounded with Volatility After Opening Sharply Lower in the Night Session, While Downstream Enterprises Remained Cautious in Their Purchases]