On May 21, copper prices saw slight increases in futures and spot markets, with refined copper trading and spot premiums falling amid weak downstream demand.
China's refined copper spot inventory increased week on week as of May 21, mainly due to gradually recovering smelter shipments and sluggish downstream procurement. Bonded inventory also experienced growth, as limited imported refined copper flowed into China's market under sluggish consumption, and some smelters' long-term export contract cargoes arrived at bonded warehouses. Moving forward, refined copper inventory in China are expected to continue slightly growing, with elevated copper prices suppressing demand and smelters' shipment to rise.
Trading in China's copper semis markets dropped on May 20, as rebounding copper prices boosted cautious sentiment and dampened spot consumption. Regarding end-use sectors of copper, demand growth remained slow. Apart from steady consumption increases in power grid and artificial intelligence, sectors such as home appliances, real estate, and new energy vehicles in China showed weak performance.
With supply concerns worsening and long-term demand expectations steady, the fundamentals will remain supportive for copper prices, though macroeconomic risks such as Fed's interest rate decisions and geopolitical concerns still need close attention.
