SMM

As of Monday, December 2, SMM copper inventories in major regions nationwide increased by 5,700 mt compared to last Thursday, reaching 143,200 mt. However, total inventories were 89,200 mt higher compared to 54,000 mt in the same period last year. Specifically, inventories in Shanghai were 71,800 mt higher YoY, Guangdong was 1,700 mt higher, and Jiangsu was 13,000 mt higher.

Specifically, inventories in Shanghai rose by 2,600 mt compared to last Thursday, reaching 108,500 mt. Inventories in Jiangsu remained basically flat at 15,100 mt. Both imported and domestic copper arrivals increased over the weekend, while consumption slightly declined, leading to an increase in inventories in east China. Inventories in Guangdong rose by 3,000 mt to 12,300 mt, as the completion of maintenance at nearby smelters and increased southbound shipments boosted total supply. Additionally, recent declines in downstream orders in Guangdong were reflected in the continuous decrease in daily outflows from warehouses.

Looking ahead, as smelter maintenance concludes, domestic copper supply is expected to increase this week, while imported copper arrivals are expected to remain basically flat compared to last week, leading to an overall increase in supply. On the demand side, with the cancellation of the copper semis export tax rebate on December 1, production at copper semis enterprises is expected to decline to varying degrees, resulting in a decrease in total demand compared to last week. According to our survey, the weekly operating rate of copper cathode rod producers is expected to drop to 79.29%, down 4.96 percentage points compared to last week. Therefore, we anticipate an increase in supply and a decrease in demand this week, with weekly inventories expected to rise again.