1.Weekly Review of the Secondary Copper Market: Price Stability and Volume Contraction Persist, Year-End Invoice Constraints Dampen Trading Activity
This week, the secondary copper market continued its pattern of "stable prices and shrinking volumes" against the backdrop of fluctuating and declining copper cathode prices, with overall trading activity remaining sluggish. The center of copper prices shifted down by 600 yuan/mt, while the price of bare bright copper in Guangdong edged up by 200 yuan/mt to a range of 82,000–82,200 yuan/mt, demonstrating the resilience of recycled copper raw material prices. Despite price adjustments, suppliers, constrained by limited inventory and strong price-holding sentiment, did not significantly increase market supply in response to price fluctuations. On the demand side, persistent weakness continued, as secondary copper rod enterprises, affected by insufficient end-user orders and restricted invoice quotas, maintained only essential procurement, resulting in limited raw material transaction volumes during the week. Regional market divergence was evident: bare bright copper prices in east China held steady at around 82,500 yuan/mt, but trading activity remained low; in south China, markets such as Foshan showed relatively stable demand for high-grade copper scrap, though overall transactions were still dominated by spot orders.
The invoice market continued to tighten, with the invoice tax rate rising to 7.5% in Guangdong and reaching 8% in Jiangxi, increasing corporate funding costs and further squeezing profit margins. Approaching year-end, secondary copper rod enterprises faced pressure from downstream end-users or traders to issue sales invoices. However, due to insufficient input invoices or local tax restrictions on total invoicing amounts, most companies prioritized using existing invoice quotas to meet previous sales commitments, leading to varying degrees of production cuts this week to ensure compliance with invoice usage regulations. Data showed that the operating rate for secondary copper rod this week was 14.45%, down 3.71 percentage points WoW and significantly lower by 17.5 percentage points YoY. The average price spread between primary and secondary copper rods narrowed to 1,952 yuan/mt, down 278 yuan WoW; the average discount of secondary copper rod in Jiangxi against copper futures decreased to 1,606 yuan/mt, narrowing by 120 yuan/mt WoW. Although secondary copper raw material prices remained stable, and the price difference between primary metal and scrap further narrowed to 3,981 yuan/mt, down 775 yuan/mt WoW, the average gross profit from secondary copper rod sales rose to 1,705 yuan/mt, up 198 yuan/mt WoW, reflecting enterprises’ ability to balance cost control and price adjustments. In the import market, non-US #1 copper scrap CIF offers were at 95-95.5% of LME 3M, while non-US #2 copper scrap under Chinese standards were offered at 95.5-96% of LME 3M. US-origin brass scrap (61.5-62% LME) flowed to non-Chinese regions. Non-US Cu98.5% wire nodules CIF offers were quoted at an LME coefficient of 94.75-95.25%, and bare bright copper CIF offers were at 96.75-97.25% of LME. US-origin bare bright copper offers to Southeast Asia were at 96-96.5% of LME, with #1 copper and #2 copper (ISRI standard) quoted at 94-95% LME and 92.5-93% LME, respectively. Supply-side pressure emerged, as reduced anode plate demand in December led to accumulation of finished product inventories among spot order producers. Long-term contract enterprises delayed invoicing due to tax invoice quota constraints, further dampening market activity. Some traders accelerated cargo pick-up after profiting from futures arbitrage, which provided slight recovery in secondary copper rod market transactions. However, end-use demand showed no substantial improvement, and the weak supply-demand pattern persisted.
Looking ahead to next week, the shortage of invoices is unlikely to ease quickly, and the operating rate of secondary copper rod enterprises is expected to see limited improvement, with a slight rebound projected to 14.71%. In the short term, copper price fluctuations will continue to dominate market sentiment. If copper prices stabilize within the range of 91,500-92,500 yuan/mt, some restocking demand may be released. However, amid the traditional consumption off-season and high inventory pressure, upside room for prices remains limited. On the policy front, attention should be paid to adjustments in tax invoice quotas and changes in anode plate demand. If invoice pressure eases after the New Year, enterprise production pace may gradually recover. Overall, the market is expected to remain in a tight balance with weak supply and demand. It is advisable for industry participants to cautiously control inventory levels and optimize cash flow management to navigate the complex year-end market environment.

2.US Dollar Index Recovers, LME Copper Edges Down, Copper Prices Fluctuate Rangebound Within the Week
Copper prices consolidated after a slight correction this week. At the beginning of the week, following the concentrated realization of previous macro tailwinds, both LME copper and SHFE copper experienced significant declines, before gradually stabilizing as bulls and bears re-engaged. After the US Fed implemented the interest rate cut, internal divisions between hawks and doves continued to widen. November's non-farm payrolls data appeared stronger than expectations, but the unemployment rate rose to 4.6%, a four-year high. Coupled with inflation data pulling back more than expected, this left room for market expectations of continued easing early next year. On Friday, the Bank of Japan announced a 25 basis point interest rate hike, which was lower than market expectations. The US dollar index saw a slight overall recovery, putting pressure on copper prices. Domestically, the Central Economic Work Conference released positive signals aimed at stabilizing growth and supporting demand, providing some support to market sentiment. This week, LME copper fluctuated between $11,500–12,000/mt, while SHFE copper saw repeated back-and-forth movement within the range of 91,500–94,500 yuan/mt.
Fundamentals side, copper concentrate long-term contract negotiations remained in the third round of discussions this week. Copper cathode long-term contract negotiations were in full swing; some Chinese smelters issued offers for 2026 bonded area long-term contracts and export long-term contracts this week, but market divergence remained significant, with no actual deals heard yet. Demand side, year-end performance was weak, with poor domestic trade consumption leading to a significant decline in premiums.
Looking ahead to next week, the macro front is expected to be quiet, and the results of the copper concentrate long-term contract negotiations are anticipated to be announced. Overall support for copper prices remains strong. LME copper is expected to fluctuate between $11,600-12,000/mt, and SHFE copper between 92,500-94,500 yuan/mt. Spot side, year-end market demand is weak, and traders also have significant repayment needs. Spot prices against the SHFE copper 2601 contract are expected to range from a discount of 240 yuan/mt to a discount of 80 yuan/mt.

3.It was like holding up a collapsing tower
It was like holding up a collapsing tower]Over the past three years, as China's smelting capacity for primary smelting has been concentratedly commissioned, year-end negotiations between Chinese smelters and Antofagasta have been particularly challenging. Since the end of last month, Antofagasta consistently maintained its Benchmark offer to Chinese smelters in the mid-negative $10 from the first to the second round. During this period, the China Smelters Purchase Team (CSPT) and the China Nonferrous Metals Industry Association repeatedly stated their firm stance: they would not accept any long-term pricing system other than the Benchmark, would not accept a negative Benchmark result, and were determined to reduce primary smelting output. Expectations for production cuts in primary smelting among Chinese copper smelters grew stronger. Facing these difficulties head-on, Chinese smelters, with one leading enterprise arguing forcefully on principle and without conceding on other terms, finally reached a $0 agreement with Antofagasta on the night of December 19, paving the way for other participating Chinese smelters to follow suit. Prior to this, market pessimism was rampant, with bearish narratives circulating widely. Given the mining company's persistent negative offers over multiple rounds, the market generally expected Chinese smelters to reluctantly accept a negative figure, ushering in an era of negative annual contracts. From the outcome, these negotiations were nothing short of turning the tide and preventing a catastrophic collapse.
On the night of December 19, 2025, leading Chinese smelters completed negotiations that will go down in the history of the copper industry: Chinese smelters and Antofagasta have finalized the copper concentrate TC/RC benchmark for long-term contracts in 2026 at $0/0.0¢. The benchmark for 2025 long-term contracts was set at $21.25/2.125¢.
Since the end of 2023, with the collapse of the fundamental supply and demand dynamics for cu cons, the spot TC for cu cons has also experienced a sharp decline. Spot TC for cu cons fell to a historic low in the mid-negative $40, while annual contract levels dropped to unprecedented lows in the history of the copper smelting industry.
Over the past three years, as China's smelting capacity for primary smelting has been concentratedly commissioned, year-end negotiations between Chinese smelters and Antofagasta have been particularly challenging. Since the end of last month, Antofagasta consistently maintained its Benchmark offer to Chinese smelters in the mid-negative $10 from the first to the second round. During this period, the China Smelters Purchase Team (CSPT) and the China Nonferrous Metals Industry Association repeatedly stated their firm stance: they would not accept any long-term pricing system other than the Benchmark, would not accept a negative Benchmark result, and were determined to reduce primary smelting output. Expectations for production cuts in primary smelting among Chinese copper smelters grew stronger. Facing these difficulties head-on, Chinese smelters, with one leading enterprise arguing forcefully on principle and without conceding on other terms, finally reached a $0 agreement with Antofagasta on the night of December 19, paving the way for other participating Chinese smelters to follow suit. Prior to this, market pessimism was rampant, with bearish narratives circulating widely. Given the mining company's persistent negative offers over multiple rounds, the market generally expected Chinese smelters to reluctantly accept a negative figure, ushering in an era of negative annual contracts. From the outcome, these negotiations were nothing short of turning the tide and preventing a catastrophic collapse.
On September 24, in his concluding remarks, Chen Xuesen, a standing committee member of the Party Committee and Vice President of the China Nonferrous Metals Industry Association, emphasized that the "cutthroat competition" within the copper smelting industry has significantly impacted the sector, harming national and industry interests and deviating from the direction of high-quality development. Enterprises in the copper industry must firmly oppose such "cutthroat competition" and pursue high-quality development. As the call for high-quality development grows louder, believes this will impact China's copper smelting industry in the following ways:

The likelihood of potential primary smelting project construction or commissioning is decreasing. Except for projects like the second phase of Chifeng Jintong, the first phase of Jianfa Shenghaike Chemical, and the expansion of Hengbang's main facility, other projects under construction may be put on hold.
The growth rate of mined primary copper output (demand for cu cons) from Chinese smelters is expected to marginally decline and is projected to turn negative starting in 2030.
The proportion of copper scrap smelting in Chinese copper smelters is expected to increase year by year. Globally, major copper cathode producing countries will shift their focus from competing for cu cons to competing for copper scrap. believes the production cuts expressed by Chinese copper smelters refer not to a reduction in copper cathode output, but to a decrease in primary smelting utilization rates, alongside greater utilization of copper scrap in the smelting process, which aligns with China's environmental policies. Therefore, although total Chinese copper cathode production will continue to increase, its growth rate will marginally decline. Smelters such as Mitsubishi's Onahama plant in Japan, PPC in Japan, and Onsan in South Korea have also publicly stated their intentions to reduce cu cons usage and replace it with copper scrap. It is evident that the competition for cu cons will transition into competition for copper scrap.

4.COMEX Copper Inventories Hit Record High, LME Copper Fluctuated and Closed Higher Overnight
Wednesday, December 24, 2025
Futures: Overnight, LME copper opened at $11,986.5/mt. After opening, the price center rose, touching a high of $12,159.5/mt, breaking through the $12,000/mt level for the first time, then fell to a low of $11,961.5/mt. Subsequently, the price center rose and fluctuated rangebound, finally closing at $12,055/mt, a gain of 1.21%. Trading volume increased by 10,400 lots to 26,000 lots, while open interest decreased by 2,837 lots to 342,000 lots. Overnight, the most-traded SHFE copper 2602 contract opened at 94,850 yuan/mt. At the beginning of the session, it touched a high of 95,180 yuan/mt, then the copper price center moved lower, probing down to 93,830 yuan/mt, and finally closed at 94,890 yuan/mt. Trading volume increased by 46,800 lots to 186,000 lots, and open interest increased by 5,200 lots to 246,000 lots.
[ Copper Morning Conference Minutes] News:
(1) On December 23, Copper Fox Metals released the latest development and exploration progress for its Van Dyke copper mine, emphasizing the project's potential to become a medium-scale, environmentally friendly copper mine.
(2) On December 23, Generation Mining stated that its Marathon copper-nickel-palladium project has reached a "shovel-ready" status and is advancing a final financing plan of approximately $1 billion.
Spot:
(1) Shanghai: On December 23, spot prices for #1 copper cathode against the front-month 2601 contract were quoted at a discount of 260-170 yuan/mt, with the average price quoted at a discount of 215 yuan/mt, down 20 yuan/mt from the previous trading day. The SMM #1 copper cathode price ranged from 93,340 to 93,600 yuan/mt. In the morning session, the SHFE copper 2601 contract generally fluctuated rangebound between 93,610 and 93,800 yuan/mt, edging up to 93,800 yuan/mt by the end of the session. The inter-month price spread was basically between C220 and C180. For tomorrow, buyer bids are still expected to maintain low expectations, trading activity is expected to be limited, and spot premiums are expected to continue declining.
(2) Guangdong: On December 23, spot prices for Guangdong #1 copper cathode against the front-month contract were quoted at a discount of 150-100 yuan/mt, with the average discount at 125 yuan/mt, down 50 yuan/mt from the previous day. SX-EW copper was quoted at a discount of 220-200 yuan/mt, with the average discount at 210 yuan/mt, down 50 yuan/mt from the previous day. The average price for Guangdong #1 copper cathode was 93,580 yuan/mt, down 95 yuan/mt from the previous day, while the average price for SX-EW copper was 93,495 yuan/mt, down 95 yuan/mt from the previous day. Overall, enterprises faced pressure to recoup funds, actively reduced prices to sell, spot premiums moved lower, and overall trading was poor.
(3) Imported copper: On December 23, warrant prices were $50-60/mt, QP January, with the average price up $7/mt from the previous trading day; B/L prices were $48-60/mt, QP January, with the average price up $3/mt from the previous day; EQ copper (CIF B/L) was $8-20/mt, QP January, with the average price up $3/mt from the previous day. Quotations refer to cargoes arriving in late December and early January.
(4) Secondary copper: The closing price on December 23 at 11:30 was 94,160 yuan/mt, up 1,510 yuan/mt from the previous trading day. The average spot premium/discount was -195 yuan/mt, down 35 yuan/mt from the previous trading day. Today, the price of recycled copper raw materials rose 600 yuan/mt MoM. The price of bare bright copper in Guangdong was 82,600-82,800 yuan/mt, up 600 yuan/mt from the previous trading day. The price difference between copper cathode and copper scrap was 4,560 yuan/mt, down 123 yuan/mt MoM. The price difference between copper cathode rod and secondary copper rod was 2,410 yuan/mt. According to an survey, as the capital utilization cost for raw material procurement and finished product hedging increased during the rise in copper prices, many secondary copper rod enterprises reported weak production willingness due to this impact. Additionally, difficulties in raw material procurement meant that operating rates before the New Year's Day holiday were not expected to be ideal.
(5) Inventory: LME copper cathode inventory increased by 825 mt to 158,575 mt on December 22; SHFE warrant inventory increased by 1,001 mt to 49,543 mt on December 23.
Price: On the macro front, US Q3 GDP grew at its fastest pace in two years, reaching 4.3%, but the US consumer confidence index declined for the fifth consecutive month. Markets continued to bet on expectations for US Fed interest rate cuts next year, putting the US dollar under pressure and pushing it below the 98 mark, which boosted copper prices. Additionally, COMEX copper inventories hit a record high, exacerbating concerns about tight supply in non-US regions and adding further momentum to the rise in copper prices. On the fundamentals, downstream procurement sentiment has not improved significantly. Overall, with macro tailwinds and expectations of tight supply, copper prices are expected to continue their upward trend today.

5. Enterprises faced pressure to recoup funds and actively lowered prices to sell goods, with spot premiums declining.
December 23:
Today, spot prices of #1 copper cathode in Guangdong against the front-month contract were at a discount of 150-100 yuan/mt, with an average discount of 125 yuan/mt, down 50 yuan/mt from the previous trading day. SX-EW copper was quoted at a discount of 220-200 yuan/mt, with an average discount of 210 yuan/mt, down 50 yuan/mt from the previous trading day. The average price of #1 copper cathode in Guangdong was 93,580 yuan/mt, down 95 yuan/mt from the previous trading day, while the average price of SX-EW copper was 93,495 yuan/mt, also down 95 yuan/mt.
Spot market: Guangdong inventory increased for the fourth consecutive day, primarily due to increased arrivals. Approaching month-end, both suppliers and downstream manufacturers faced pressure to recoup funds, leading suppliers to actively sell goods and downstream buyers to reduce purchases, causing spot premiums to continue declining. The procurement sentiment for copper cathode in Guangdong was 1.43, down 0.07 from the previous trading day, while the sales sentiment was 3.18, up 0.10 from the previous trading day (historical data can be queried in the database). As of 11:00, high-quality copper against the front-month contract was quoted at a discount of 100 yuan/mt, standard-quality copper at a discount of 150 yuan/mt, and SX-EW copper at a discount of 210 yuan/mt.
Overall, enterprises faced pressure to recoup funds, actively reduced prices to sell goods, spot premiums declined, and overall trading was weak.