China's copper inventories shrink as stocks flow to spot market
Author:Network sources Source:Network sources Date:2013-04-26

China's copper inventories have shrunk as stocks flowed to the domestic spot market for consumption, state-run metals consultancy Beijing Antaike said Tuesday.


Copper stocks in the Shanghai Futures Exchange were 223,663 mt on Friday, down 4,627 mt from April 12, exchange figures showed.


Copper inventories at China's bonded warehouses fell to 600,000-700,000 mt in the second quarter, down 30-40% from 1 million mt in the first quarter, Galaxy Futures said in its commodity report Wednesday.


"Although the current inventories are lower than earlier on [this year], the quantity is still very big, thus pressuring down prices," the analyst said.


He Xiaohui, a copper analyst with Antaike, agreed with Chinese copper industry experts that the recent drop in domestic copper stocks was related to demand by the downstream copper processing sector and to fewer materials being stored at the warehouses by smelters on lack of crude copper.


"Based on our preliminary findings, it's true that some cargoes have lately flown into the spot market for consumption purposes," He said.


Meanwhile, spot Chinese copper prices dropped this week to levels not seen since November 2009, as current domestic inventories stayed high, Antaike said.


In Shanghai, spot domestic refined copper prices averaged Yuan 50,640/mt ($8,113) Tuesday, down Yuan 260 from Monday. In November 2009, prices averaged Yuan 51,962/mt.


China produced 1.546 million mt refined copper in Q1, up 11% from the same period last year, according to data from the National Statistics Bureau.

 

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