China Copper Spot Premium Surges to Highest Since 2021 as Futures Slip Into Deep Backwardation
nashnova research
Shanghai spot copper premium jumped to CNY 1,900/tonne — a three-year high — while futures slid into the steepest backwardation since 2022, as smelter cuts and restricted overseas supply force processors into hand-to-mouth buying.
Why did the spot premium spike to a three-year high?
On Nov 5 the Shanghai spot copper premium over futures hit CNY 1,900/tonne (≈ US$285), the highest since 2021.
A spot premium — the extra buyers pay for immediate delivery over the futures price — widens when physical metal is scarce. This means → the pool of cathode copper available right now is shrinking fast.
Zhou Xiao'ou, analyst at Zijin Tianfeng Futures, pointed to two drivers: domestic smelter output cuts and constrained supply from Africa and Russia.
What is the futures market signalling?
The Shanghai copper December-over-January spread has widened to US$880/tonne, the steepest backwardation since 2022.
Backwardation — when near-month prices trade above later months — in plain terms = buyers would rather pay more now than wait, because no one trusts that metal will be available later.
A separate gauge confirms the squeeze: the Yangshan copper premium, which tracks China's import demand, has also climbed to a record high. This reflects a shortage not just in spot markets but at the import end too.
Copper has rallied all year — so why is there still a shortage?
Copper prices surged this year on expectations that the Trump administration may impose tariffs on refined copper, prompting a wave of metal shipments to the US. This means → America's pre-emptive stockpiling drained supply from every other market.
The rally has cooled in recent weeks, however: markets are questioning whether the data-centre buildout boom can last, and data centres have become a major driver of copper demand.
As of the morning of Nov 5, LME copper edged up 0.2% to US$14,044.50/tonne; aluminium rose 1.1%; Singapore iron ore gained 1.2% to US$92.75/tonne.
What should we watch next?
The spot premium and futures backwardation are widening in tandem — the supply gap has not been plugged yet.
Whether it closes depends on two things: when domestic smelters restart and how quickly overseas imports can ramp up.
Put simply = if either supply line falls behind, processors will stay in hand-to-mouth mode — buying whatever they can, whenever they can.
市场有风险，内容仅供研究参考，不构成投资建议。