Copper prices continued slightly rising in China's futures and spot markets on August 26, while dropped at the LME. U.S. inflation data came in higher than expected, raising the likelihood of a Federal Reserve rate increase and exerting some downward pressure on copper prices. On the supply side, copper concentrate tightness remained hard to fundamentally improve, and expectations of U.S. tariffs on refined copper continue to keep available supply relatively constrained. On the demand side, near-term demand remained stable and solid, while high-end manufacturing will underpin long-term consumption. Overall, copper market fundamentals continued to support prices.
China's refined copper trading dropped on August 26, with spot premiums generally rising across major markets. Availability of refined copper with same-month invoices in the market remained tight, reinforcing holders' firm pricing stance and pushing spot premiums higher. Coupled with weak end-use orders and cautious market sentiment, refined copper spot transactions decreased. In contrast, as rising copper prices in China widened the refined-scrap copper price spread, scarp trading improved, but upstream sources were limited due to frequent sales earlier and downstream procurement was constrained by sluggish orders, leading to only a modest increase.
Trading in China's copper semis markets varied on August 26. Copper rod orders slightly increased as growing raw material prices added to secondary rod's arbitrage opportunities, with traders' transactions rising while end-user orders still limited. Copper tube, copper bar, and brass plate/strip trading remained subdued under elevated raw material prices and weak end-use demand, while red copper plate/strip orders stayed relatively stable, supported by end-use sectors such as power grid and new energy. Overall, copper consumption in China stayed mediocre during the off-season.
