On June 4, copper prices dropped in futures and spot markets, with positive market sentiment diminishing and inflation risks growing. However, the copper market fundamentals remained supportive on tightening global supply and long-term firm demand expectations.
China's refined copper spot premiums slightly increased on June 4, as downstream procurement increased amid falling prices. Transactions also grew, though no notable demand releases happened.
Refined copper spot inventory in China continued falling as of June 4, due to limited arrivals of domestic and imported copper, and generally weak spot demand. In contrast, China's bonded inventory slightly increased, as limited refined copper flowed into China's market amid less favorable import ratio.
Trading in China's copper semis markets improved on June 4, with spot transactions primarily based on end-users' rigid demand and occurring mostly between large enterprises. However, frequently fluctuating copper prices raised market caution recently, and some downstream processors were bearish about copper prices, avoiding stockpiling.
Moving forward, despite a strongly supportive fundamentals, macroeconomic factors such as U.S. interest rate movements, Middle East conflicts, and U.S. tariff decisions, also need close attention, which may cause sharp short-term fluctuations of copper prices.
