Guangdong Copper Premiums Fall Amid Rising Prices and Reduced Demand

The copper market in Guangdong region saw premiums decline this week due to rising prices and reduced downstream procurement volumes. As of Thursday, high-quality copper was quoted at a premium of 250 yuan/mt, down 70 yuan/mt from last Thursday, while standard-quality copper was quoted at 150 yuan/mt, also down 70 yuan/mt.

The price spread for standard-quality copper premiums between Shanghai and Guangdong stood at 140 yuan/mt in favor of Guangdong, a relatively small spread that did not trigger inter-regional transfers. Total inventory in Guangdong warehouses increased by 200 mt to 8,200 mt as of Thursday, with warrants totaling 800 mt, down 300 mt from last Thursday.

Warehouse arrivals were up 4,700 mt/week WoW to 13,900 mt/week, on par with the annual average level, driven by increased shipments from smelters and imported copper. However, warehouse withdrawals were slightly below the annual average level at 13,700 mt/week, down 800 mt from last week.

Copper prices continued to rise, leading to a wait-and-see sentiment among downstream enterprises with reduced procurement volumes. Looking ahead, arrivals are not expected to increase significantly, but downstream consumption may recover if copper prices fall notably, and spot premiums could continue rising.