Refined copper annual long order for 2023 began to be negotiated in November 2022, and market participants began to visit industrial chain enterprises. Refined copper's spot premium pattern has been relatively obvious since 2022. A long-time running of low inventories supported spot premiums to rise.
Average premium of China premium copper, standard copper, and hydrometallurgical copper were Yuan 254.98/tonne, Yuan 230.2/tonne, and Yuan 144.4/tonne respectively January to October, soaring by 130%, 245%, and 3309% year on year, according to Mystee. Thus, long order premium of refined copper is expected to rise significantly in 2023.
Data Source: Mysteel
Average spot price of 1# refined copper in China is Yuan 67,646/tonne, which decreased by 5% year on year, according to Mysteel. The annual average price in 2021 was Yuan 68,478/tonne which was slightly higher than that of Yuan 68,067/tonne in the first ten months due to the significant increase in copper prices in November and December.
Data Source: Mysteel
Warehouse receipt premiums of imported copper in Shanghai Yangshan Port averaged $74.8/tonne from January to October, increasing by 6% year on year. Bill of lading premiums averaged $72.4/tonne, which increased by 12% year on year.
Due to the periodic supply tightness of imported copper and the profitable SHFE (Shanghai Futures Exchange)/LME (London Metal Exchange) copper price ratio since the second half of 2022, this stimulated the raise of port spot premiums.
Data Source: Mysteel
Refined copper spot long-order negotiations for 2023 will occur in November. Refined copper premiums for long-order were basically at Yuan 40-140/tonne in 2022, which varied according to brands and order sizes. The average premium is around Yuan 230/tonne this year. These doubling premiums will make long-order negotiations more difficult. Some enterprises have tried to offer a long order premium at Yuan 200-260/tonne presently, but no one has responded for the time being.
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