Copper prices continued rising in futures and spot markets on August 25, with macro sentiment fluctuating but the fundamentals remaining supportive. Available refined copper inventory outside the U.S. stayed tight, as China's inventory declined from an already low level and LME cancelled warrants notably increased, supporting copper prices from the supply side.
China's refined copper trading dropped on August 25. Spot supply tightened, leading spot premiums to generally increase across major markets in China and suppressing spot transactions. Copper scrap transactions also decreased. Upstream scrap holders were willing to sell, but available scrap was limited, and downstream processors stayed purchasing based on rigid needs. Moreover, with end-use demand weak and downstream finished product orders sluggish, processors became even more cautious in procuring raw materials.
Trading in China's copper semis markets stayed mediocre on August 25. The upward adjustment in processing fees for refined copper rods led to a subdued market response, with few spot orders. Offers for secondary copper rods declined, as month-end shortages in scrap copper invoice quotas constrained production and market supply. Copper plate/strip trading remained mediocre, and copper tube trading stayed quiet, with downstream stockpiling sentiment subdued. In the copper bar market, end-use sectors such as plumbing valves and refrigeration were in the off-season, resulting in insufficient orders and weak supply and demand dynamics.
Overall, high copper prices curbed consumption release, with the market mainly focused on restocking for essential needs. As the peak season will gradually start in September, demand expectations may improve, though actual demand release still needs to be observed.
