By Polly Yam
HONG KONG, March 10 (Reuters) - China's February imports of unwrought and semi-finished copper products rose 10.3 percent from a month ago versus expectations of flat to lower levels, due to attractive margins for spot arrivals and increased credits.
The world's top copper consumer imported 322,282 tonnes of copper, including anode, refined copper, alloys and semi-finished copper products, in February after a 21 percent drop to 292,096 tonnes in January, preliminary data released by the General Administration of Customs showed on Wednesday.
For a graphic showing copper imports, click:
http://graphics.thomsonreuters.com/310/CN_CPRIMP0310.gif
The import figures surprised traders, who had expected inflows around 282,000 tonnes due to the Lunar New Year holiday in mid-February.
'The arbitrage ratios were good in February and that spurred spot imports,' said Zhu Yanzhong, an analyst at Jinrui Futures, who estimated the imports included 230,000-240,000 tonnes of refined copper, the most popular type in international and Chinese markets, and above the 190,000 tonnes expected.
For a graphic of the LME-Shanghai arbitrage, click:
http://graphics.thomsonreuters.com/gfx/NT_20101003104801.jpg
Zhu said in February that a lot of imported copper had been traded in the domestic market, reflecting the spot imports.
'Any upward number would be interpreted as bullish for copper prices, indicating Chinese demand remains firm. For all sorts of reasons this looks strong. February is a short month and even shorter this year because of the Lunar New Year,' David Moore, commodities Strategist at Commonwealth Bank of Australia, said.
Attractive arbitrage buying from the London Metal Exchange and selling to the Shanghai market had encouraged spot copper imports, spurring arrivals in early February, Li Ye, copper analyst at Minmetals StarFutures, said.
Importers had also taken copper from bonded warehouses to sell for profit and thereby cut demand for fresh arrivals, traders said.
Chinese importers had reduced term loadings in January and February from Chile due to expected high stocks in the domestic market in the first quarter and had asked overseas suppliers not to send term shipments around mid-February, when the country started a week's break for the Lunar New Year.
But that were offset by strong spot imports, also supported by increased credits for copper imports after briefly tighter funding in January cutting imports.
(Editing by Ed Lane)
((polly.yam@thomsonreuters.com; +852 2843 6933; Reuters Messaging: polly.yam.reuters.com@reuters.net)) Keywords: CHINA TRADE/BASEMETALS (If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
HONG KONG, March 10 (Reuters) - China's February imports of unwrought and semi-finished copper products rose 10.3 percent from a month ago versus expectations of flat to lower levels, due to attractive margins for spot arrivals and increased credits.
The world's top copper consumer imported 322,282 tonnes of copper, including anode, refined copper, alloys and semi-finished copper products, in February after a 21 percent drop to 292,096 tonnes in January, preliminary data released by the General Administration of Customs showed on Wednesday.
For a graphic showing copper imports, click:
http://graphics.thomsonreuters.com/310/CN_CPRIMP0310.gif
The import figures surprised traders, who had expected inflows around 282,000 tonnes due to the Lunar New Year holiday in mid-February.
'The arbitrage ratios were good in February and that spurred spot imports,' said Zhu Yanzhong, an analyst at Jinrui Futures, who estimated the imports included 230,000-240,000 tonnes of refined copper, the most popular type in international and Chinese markets, and above the 190,000 tonnes expected.
For a graphic of the LME-Shanghai arbitrage, click:
http://graphics.thomsonreuters.com/gfx/NT_20101003104801.jpg
Zhu said in February that a lot of imported copper had been traded in the domestic market, reflecting the spot imports.
'Any upward number would be interpreted as bullish for copper prices, indicating Chinese demand remains firm. For all sorts of reasons this looks strong. February is a short month and even shorter this year because of the Lunar New Year,' David Moore, commodities Strategist at Commonwealth Bank of Australia, said.
Attractive arbitrage buying from the London Metal Exchange and selling to the Shanghai market had encouraged spot copper imports, spurring arrivals in early February, Li Ye, copper analyst at Minmetals StarFutures, said.
Importers had also taken copper from bonded warehouses to sell for profit and thereby cut demand for fresh arrivals, traders said.
Chinese importers had reduced term loadings in January and February from Chile due to expected high stocks in the domestic market in the first quarter and had asked overseas suppliers not to send term shipments around mid-February, when the country started a week's break for the Lunar New Year.
But that were offset by strong spot imports, also supported by increased credits for copper imports after briefly tighter funding in January cutting imports.
(Editing by Ed Lane)
((polly.yam@thomsonreuters.com; +852 2843 6933; Reuters Messaging: polly.yam.reuters.com@reuters.net)) Keywords: CHINA TRADE/BASEMETALS (If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
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