China Desk · 2026-10-11

China Desk Digest 2026-10-11

Copper: SHFE backwardation meets heavy LME warrant cancellations

SHFE copper's front month trades at a premium to the second month, with the 2610/2611 spread at 1100 (China domestic curve, as of 2026-10-09). The curve sits in backwardation, signalling nearby tightness on the domestic side. On the LME, copper cancelled warrants stand at 101725.00 against opening stock of 235225.00 (LME warrant data, as of 2026-10-09). That cancelled ratio of 43.25 points to a large share of metal queued for exit. Watch whether physical pull from Asia keeps both signals aligned.

Rebar and iron ore: term structure splits across the steel chain

SHFE rebar shows contango, with the 2610/2611 spread at -58 (China domestic curve, as of 2026-10-09), a mild contango of -1.9 pct. DCE iron ore, by contrast, is in backwardation, with the 2611/2612 spread at 2.5 (China domestic curve, as of 2026-10-09). The divergence suggests raw material support is not feeding through to finished steel pricing. Iron ore's main month is 2701, while rebar's main month also sits at 2701. Traders should track whether the steel margin squeeze persists.

Yangshan copper premiums jump, but spot basis data is absent

Yangshan copper premiums rose sharply, with both warehouse receipt and Bill of Lading averages up 10.00 (Yangshan copper premium, as of 2026-10-09). The average price for warehouse Receipts now stands at 135.00, while Bills of Lading average 130.00. That move aligns with the tight domestic term structure seen on SHFE. Note that the basis block is empty for this date, so no onshore spot basis is available to cross-check the premium signal. Treat the premium jump as indicative only.

Lead and tin: LME cancellations diverge across base metals

LME lead cancelled warrants total 38550.00 against opening stock of 347875.00 (LME warrant data, as of 2026-10-09), a cancelled ratio of 11.08. Tin shows a firmer picture, with cancelled warrants at 960.00 from opening stock of 4310.00 (LME warrant data, as of 2026-10-09), a cancelled ratio of 22.27. The gap suggests relatively more near-term demand for tin warrants than lead. Desk note: no SHFE term data is supplied for either metal, so domestic confirmation is unavailable.

Gold contango, silver backwardation: precious metals curves diverge

SHFE gold is in contango, with the 2610/2611 spread at -5.68 (China domestic curve, as of 2026-10-09), a mild -0.63 pct. Silver tells the opposite story, in backwardation with the 2610/2611 spread at 79 (China domestic curve, as of 2026-10-09), or 0.54 pct. The split hints at differing carry and lease dynamics between the two metals. Both contracts share a main month of 2612, and neither rolled. Watch whether silver's premium over the next month widens further.

Data provenance

• China domestic term structure (M1-M2 spread, main contract) as of 2026-10-09
• LME cancelled warrants as of 2026-10-09
• Yangshan copper premium (USD/t) as of 2026-10-09
• China headlines, 2026-10-11
• English-native China flashes — SMM_EN / Mysteel_EN, 2026-10-11