On May 27, copper prices fell in futures markets, but increased slightly in China's spot market. With developments in the Middle East conflict frequently changing and macroeconomic signals mixed, copper prices have been fluctuating at elevated levels recently, supported by the fundamentals.
Raw material supply stayed tight in the copper industry. Recent disruptions on overseas copper mining were frequent. Though the earthquake in Chile's Antofagasta region caused limited impact on local mining operations, further developments need close attention. Peru's energy crisis also boosted market concerns on mined copper supply. In terms of copper scrap, tax policy adjustments and invoice quota continued to limit scrap availability in China.
China's refined copper spot trading slightly increased on May 27, as downstream enterprises became cautious about raw material procurement toward the month-end and end-user consumption saw no notable growth. Spot premiums generally declined in China's major markets, due to holders' intention to lower prices for sales.
Trading in China's copper semis markets remained constrained due to high prices and weak end-user consumption. Market activity was generally dominated by deliveries of previous orders, with limited spot demand growth reported. Moving forward, end-user demand in China is unlikely to significantly increase during the traditional off-season, with performance expected to continue diverging across sectors.
