East China Copper Inventory Draws Down, Premiums Expected to Hold Steady

Copper premiums in Shanghai spot market are expected to remain stable tomorrow due to significant destocking in east China and low import arrivals. According to SMM, the social inventory in the Shanghai region decreased by 12,300 mt compared to last Thursday, while the combined inventory in the two regions in east China dropped by 16,400 mt. This decline exceeded market expectations and strengthened downside support for premiums.

The persistently unfavorable SHFE/LME price ratio has led to a decrease in port arrivals from outside China, coupled with some shipment delays that have limited the supplement of imported copper to the spot market. On the demand side, after last week's slight correction in copper prices, there was a release of dip-buying demand from downstream, and the backwardation price spread between futures contracts widened, increasing suppliers' willingness to sell.

Although intraday buying sentiment rebounded, transactions for standard-quality copper only occurred after successive downward adjustments in offers, reflecting that downstream acceptance of higher premiums remains limited. As a result, spot prices against the SHFE copper 2609 contract are expected to maintain a premium tomorrow, with the overall center likely to gradually stop falling and stabilize.