London 23/08/2016 - Copper stored in listed LME sheds in Busan jumped to its highest level since January 2013, data showed on Tuesday.
Stocks in the Korean city rose a net 11,775 tonnes to 59,100 tonnes, adding to the 10,175 tonnes that were delivered yesterday. Also of note yesterday was the delivery of 8,800 tonnes into Gwangyang, lifting the total there to 22,775 tonnes.
Market participants expect more copper to flow from China into the LME's Asia warehouses from late-August and September onwards due to poor premiums in China, while some trading houses are still able to break even while exporting despite lower warehouse incentives.
At least 30,000-40,000 tonnes of copper cathodes could flow into locations such as South Korea, Singapore, Malaysia and Taiwan, according to FastMarkets' estimates based on plans provided by various sources.
The copper price was little changed - the stock increases seem to have been priced in. Three-month metal was last at $4,747 per tonne, down $1.50 on Monday's close. Take-up has been thin - fewer than 3,000 lots have changed hands on Select so far today.
In spreads, the benchmark cash/threes was last at $17 contango, having closed yesterday at $15 contango. The most recent warrant holding data showed there was one holder across all three reported positions in the 50-79 percent bracket.
Total global stocks at 240,075 tonnes are the highest since January. Cancelled warrants fell 3,600 tonnes to 53,725 tonnes.
(Additional reporting by Vicky Chen, editing by Mark Shaw)