On April 2, copper prices in both futures and spot markets declined slightly, primarily due to weakening expectations for a quick resolution of the Middle East conflicts, which diminished market risk appetite and suppressed copper prices. The drop in copper prices, coupled with the approaching Qingming Festival holiday (April 4-6), prompted downstream restocking in China, leading to a modest rebound in copper cathode spot trading.
China's copper cathode spot inventory dropped week on week, despite a moderated pace. Shipments from some smelters were constrained by maintenance, while rising demand led to decent outflows from warehouses. However, China's copper cathode import margin improved this week, bringing increased imported copper inflows, which slowed the pace of inventory declines.
Falling copper prices further narrowed the refined-scrap copper price spread in China and kept it below the reasonable level, resulting in losses for copper scrap holders and tightening market supply.
Spot demand in the downstream copper semis market saw a limited increased. Amid recent sharp copper price fluctuations, market participants remained cautious, focusing primarily on long-term contract operations. In April, the peak consumption season, end-use demand is expected to increase.
Written by Mingyuan Wang, wangmingyuan@mysteel.com
