Kitco News: Chinese physical copper markets rally amid expectations of robust consumption growth

Shanghai copper prices currently trade at a premium to long-term contracts amid expectations of rising Chinese demand. As reported by Kitco News, traders are accelerating refined copper shipments to the US to capitalize on potential arbitrage opportunities ahead of anticipated American tariff measures.

 The current backwardation is minor. It does not cause serious concerns about the supply of copper. Market analysts attribute the price divergence primarily to surging Chinese demand for the industrial metal, according to industry experts cited in the report.

The price dynamics is also driven by the higher exports of refined raw materials from China and smelters' repair works in March due to scarcity of copper concentrate.

Chinese customs data shows a 119% year-on-year rise in export shipments of refined metal in the first 2 months of this year.

Shanghai refined copper inventories declined 4% week-over-week to 333,600 tons as of March 24, according to Shanghai Metals Market (SMM) data. The current stockpile represents a 13.9% year-on-year reduction.