On April 9, copper prices saw mild increases in futures markets while slightly declined in China's spot market. Consequently, China's refined copper spot trading slightly improved, and spot premiums increased in major markets as the near-month contract contango structure remained wide. Improving downstream consumption and smelters' maintenance kept refined copper traders' inventory in China declining this week, despite increased imported copper arrivals due to the widened import margin.
China's copper scrap market supply slightly rose amid elevated copper prices on April 9, with the refined-scrap copper price spread remaining below the reasonable level. Rising raw material availability boosted production and sales willingness at downstream processors using copper scrap as raw materials, though their costs stayed high.
Volatility in Middle East conflicts intensified caution in end-users of copper, leading to generally mediocre demand for copper semis on April 9. Though April remains China's traditional peak consumption season, market participants generally held low confidence in actual demand, and copper consumption may remain largely supported by rigid downstream and end-use production needs.
Moving forward, close attention should be paid to the negotiation among various parties in the Middle East conflicts, as well as the actual performance of China's peak consumption season in April.
Written by Mingyuan Wang, wangmingyuan@mysteel.com
