Shanghai Copper Premiums Expected to Rise Amid Tight Supply

Copper premiums in Shanghai are expected to continue rising due to tight available supply and strong demand from downstream processing enterprises. Although some imported copper has started arriving, its impact on the market will be limited in the short term.

The high prices and backwardation between prompt and forward months have already led to increased procurement costs for downstream buyers, which may reduce their acceptance of high premiums. Market participants are advised to monitor the risk of negative feedback on demand amid these factors.

Currently, available supply in Shanghai is expected to remain tight, with some downstream enterprises still having pre-holiday stockpiling demand. Spot premiums continue to receive strong support, but copper prices are already at elevated levels, making it difficult for prices to rise significantly without causing a decline in demand.