Chinese spot price of 1# refined copper (Cu:≥99.95%) jumped by Yuan 1,135/tonne day on day to Yuan 69,092/tonne on July 3, according to Mysteel's assessment.
Specifically, spot prices of 1# refined copper in Shanghai under Mysteel's tracking increased by Yuan 1,200/tonne day on day to average at Yuan 69,155/tonne, running in the range of Yuan 69,080-69,230/tonne. Moreover, its premium rose by Yuan 70/tonne day on day to Yuan 425/tonne.
Refined copper transactions in China weakened with a sharp increase in copper prices. Downstream producers held a wait-and-see stance and the whole trading atmosphere was light. Spot holders in Shanghai market raised the premium to Yuan 500/tonne at the beginning of the morning and reduced it to Yuan 400/tonne due to the rapid increase in copper prices. Overall, high copper prices and premiums restrained downstream demand. The back structure of the Shanghai Futures Exchange July and August contracts expanded to Yuan 400/tonne. Spot premiums are expected to fall in the short term due to weak demand and imported copper entrance.
The trading volume of refined copper rods in China decreased with the rise of copper prices. Transactions in East China fell to 100-300 tonnes for small and medium producers and 400-500 tonnes for large enterprises. Delivery in North China also declined due to expanding price advantage of secondary copper rods. Producers in South China reduced processing fees to stimulate transactions.
Secondary copper rod transactions in China remained weak. Although the price spread between refined and secondary copper rods extended, high absolute prices of finished products depressed end users' consumption. Fabricators in North China lowered price quotations to achieve orders. The trading volume in South China kept at 100-200 tonnes and delivery in North China remained at 5-6 trucks.
Scrap transactions in China increased obviously. Scrap holders delivered actively with the rebound of copper prices. Processing enterprises restocked positively on the improvement of finished products' orderbooks.
Written by Ting Ao, aoting@mysteel.com
Edited by Paula Xu, xuzhongping@mysteel.com
