The Shanghai grade-A copper premium increased in the week to Tuesday March 10 on improved arbitrage opportunities following a sharp drop in London Metal Exchange copper earlier in the week, while markets participants in Europe and the US struggle against robust copper cathode availability.
Shanghai market participants capitalize on import arbitrage opportunitiesLME warrant availability hampers dip-buying in EuropeHigh-grade copper scrap offsets US cathode appetite Shanghai copper premiums rise on arb dealing
The Shanghai copper premiums, both on cif and in-warehouse basis, rose in the week ended on Tuesday March 10, due to higher arbitrage deals, Fastmarkets learned.
Fastmarkets assessed the
copper grade-A cathode premium, cif Shanghai at $50-65 per tonne on Tuesday, up by $4 per tonne at the mid-point from $45-62 per tonne a week prior.
"I did arbitrage deals on Monday morning after LME copper collapsed, creating opportunities for arb trades," a Shanghai-based trader said.
"The increase [in premiums] is because of the arb deals and has little relation to purchases from downstream plants, [and] they are still recovering," a second trader in Shanghai added.
The loss...