European refined copper premiums still adjusting to recent rises; China premiums under pressure

European copper premiums continued to respond to the unprecedented increase in long-term contract levels in the week to Tuesday February 7, while those in China faced downward pressure due to limited buying and there was no movement in the US


The European refined copper market is continuing to re-adjust to the new reality of higher long-term contracts, sources told Fastmarkets in the two weeks to Tuesday February 7. One trader source said that the big increases had not been seen before and the market was not used to dealing with the implications.

Fastmarkets assessed the copper grade A cathode premium, delivered Germany at $180-250 per tonne on February 7, widening from $190-250 per tonne on January 24.

Traders continued to report liquidity above the current range, but said that such trades were not reflective of the broader spot market.

Some market participants suggested the sudden spike in premiums had caused a rush to buy, which then caused a slight scaling back of premium levels.

Liquidity was also reported around the lower end of the current range, with material purchased on last year’s long-term deals likely to be the reason, sources said.

But they added that, as 2022 material depletes, the lower end of the current range could face upward pressure.

Orders from consumers in Germany were maintaining the momentum in the market.

“We are still optimistic [about the German market],” one trader source told Fastmarkets, adding that there was strong demand from the automotive and electronics sectors.

Fastmarkets’ fortnightly assessment of the copper grade A cathode premium, cif Rotterdam was $80-120 per tonne on February 7, moving up from $70-100 per tonne in the previous session.

Most sources told Fastmarkets that below $80 per tonne was no longer reflective and that fresh liquidity above the previous range supported the move higher — although they admitted the market was still “relatively quiet and hard to read” as of Tuesday.

“I am unclear on Rotterdam,” one source said, because it was less obvious than other markets in the region.

The lower end of Rotterdam premium’s range has moved up quickly so far in 2023, having started the year at $50 per tonne. It now sits at $80 per tonne having previously represented brands that were less sought after than other LME deliverable material. The most recent sessions have seen no liquidity reported for these brands and sources told Fastmarkets there had been only limited buying interest in such material.

The Italian market, meanwhile, was said to be quiet, with limited demand from the construction sector.

Fastmarkets’ fortnightly assessment of the copper grade A cathode premium cif Leghorn has narrowed down by $10 at the top end of the range to $150-180 per tonne, with market participants no longer regarding anything above $180 per tonne as viable.

Sources said that the levels achievable in Northern Europe meant many market participants operating there and in the south would be unlikely to offer material in Italy, unless the market picks up.

While there were offers heard below the current range, such material was not seen as reflective of the market as market participants said the material was moved quickly.


China’s import appetite for copper cathodes remained limited in the week to February 7, with buying activity capped by unfavorable import conditions leading to a decline in premiums. There was some pick-up in spot buying in Southeast Asia after the 2023 Lunar New Year holiday, however, which meant the premium there moved up.

Fastmarkets’ daily benchmark assessment for copper grade A cathode premium, cif Shanghai was $8-25 per tonne on Tuesday, down by $5-7 per tonne from $15-30 per tonne a week prior, marking the lowest level since mid-March 2022.

Fastmarkets’ daily assessment of copper grade A cathode premium, in-whs Shanghai was $10-30 per tonne the same day, down by $10 per tonne from $20-40 per tonne the previous week, and also the lowest since mid-March last year.

There were some sell-offs late last week due to the lack of spot demand pushing down the premium, but market sentiment improved slightly from the beginning of this week amid a narrower arbitrage loss, with more spot units on offer, Fastmarkets understands.

“Spot offers increased this week, but the market is not fully recovered yet, with limited buying leaving the premium weak,” a Shanghai-based trader said.

“It’s typically an off-season in January and February, with sustained import losses since late last year adding to downward pressure,” a second trader in Shanghai told Fastmarkets.

The Southeast Asian copper market bucked the decline, however, and a pick-up in spot buying after the 2023 Lunar New Year holiday saw the premium there rise.

“We did some spot business after the holiday, with the number at $80-90s [per tonne], and the market is on the way of recovery now,” a Singapore-based trader said.

A deal heard reported in the region was for copper cathodes exported from China, sources said.

Fastmarkets’ weekly assessment of the copper grade A cathode premium, cif Southeast Asia at $75-95 per tonne on Tuesday, up from $65-85 per tonne a week earlier.

United States

Fastmarkets’ weekly assessment of the copper grade 1 cathode premium, ddp Midwest US was unchanged at 10-12 cents per lb on Tuesday, February 7.

The premium has been at its current level since October 25.

Market participants reported a very quiet spot market with buyers continuing to meet their cathode needs through long-term contracts and refraining from entering the spot market.

Sources also told Fastmarkets that they were wary of possible disruptions on the supply side due to protests in Peru and the upcoming planned outage at the Kennecott smelter in Utah in the US.

“If the strike in Peru continues, it will be a problem,” one trader told Fastmarkets, adding that buyers were now interested in acquiring copper scrap because of the delayed shipments from Peru and Chile.

The existing supply and demand balance has been maintained, however, keeping the US premiums stable, according to sources.

“The market is really balanced,” a second trader said.

“Nothing is going on,” according to a third source, who said that if spot business was to pick up, the market could see higher priced copper in late February or early March “because of [the protests in Peru,].”

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