Copper prices continued rising in futures and spot markets on September 8, refreshing historical highs on tight available refined copper supply, slowing concentrate output growth, and strong demand expectations. However, macroeconomic uncertainties will persist, and caution is warranted against potential pullback risks going forward.
China's refined copper spot trading decreased on September 8 under record-high prices. Downstream enterprises became more cautious, and as circulating supply remained limited, holders also showed restrained selling activity. Spot premiums also dropped across major markets, with weak consumption expected to continue suppressing premiums.
Scrap trading, in contrast, increased as the refined-scrap copper price spread widened notably on September 8. Holders saw substantial profits on their inventory and accelerated sales. However, downstream scrap processors faced slow conversion of finished product profits due to invoice quota constraints and high tax rates, leaving them under significant liquidity pressure. As a result, scrap processors purchased mainly on rigid demand.
Trading in China's copper semis markets dropped on September 8, with rallying copper prices significantly suppressing end-user consumption. Meanwhile, the pullback in China's refined copper spot premiums also suggest that end-users had limited acceptance of record high copper prices. Consequently, demand recovery is likely to continue at a slow pace moving forward, despite the upcoming consumption off-season.
