GLOBAL COPPER WRAP: Shanghai premiums at 6-month low; European annual talks start to see discounts

Shanghai copper cathode premiums dropped to a six-month low in the week ended Tuesday 17, while in Europe spot interest was muted as market participants eyed lower annual premiums for 2020 and in the Unites States the market remained flat amid poor demand.

  • Shanghai deliverable premium assessments at six-month low
  • EQ premiums trading lower in Shanghai
  • Some sellers start to offer annual premiums in Europe at discounts to regional benchmarks
Shanghai copper premium drops to six-month low
Spot premiums for copper cathodes in Shanghai have dropped to their lowest levels since June this year, driving buyers out of the market for cif cargoes.
At $50-63 per tonne on Tuesday December 17, the Fastmarkets copper grade A cathode premium, cif Shanghai assessment was down by $2-4 per tonne from $54-65 a week prior.
A worsening negative arbitrage to import physical copper into China is continuing to depress premiums there; since the start of December the Shanghai SHFE active contract is up 3.96% at 49,070 yuan ($7,011), while the LME's three-month copper price is up 4.77% at $6,167, making it more expensive to bring units into the country.

The average...

Published

Archie Hunter

Julian Luk

Rijuta Dey Bera

Sally Zhang

December 18, 2019

15:00 GMT

London, Shanghai, New York