Japan: Benchmark electric copper price touches record high on currency depreciation

Japan's electric copper quote, which is a reference for domestic bilateral transactions of copper, reached a record high for the first time in the last six months since October, 2021. While prices in the overseas copper market remained high, the yen's depreciation and dollar's appreciation led to the record price rise.

JX Nippon Mining & Metals announced on the 19 April, 2022 that it will raise prices of electrolytic copper by a record high JPY 20,000 /t to JPY 1.36 million/t. The average price in April was JPY 1,341,500/t.

Japan's electric copper benchmark quotes have been rising since the beginning of this year, propelled by the rise in overseas copper prices against the backdrop of Russia's invasion of Ukraine. From JPY 1.1 million/t, prices moved up to JPY 1.2 million/t in March 2022 and crossed the threshhold of JPY 1.3 million/t during the same month.

Prices had reached JPY 1.34 million/t in October last year, but remained at that level temporarily, dropping off to JPY 1.1 million/t levels towards the month-end.

However, this time, prices sustained at high levels even after crossing JPY 1.3 million/t, reaching the highest price on 6 April. The monthly average is also in the JPY 1.3 million/t range, which is exceptionally high.

The London Metal Exchange (LME) copper price, which is a benchmark indicator, has risen due to concerns over supply disruptions in Russian copper bullion due to the economic sanctions against it.

Currently, the upside is heavy due to concerns about a slowdown in China due to a long-term lockdown. Three-month futures prices have continued to move in a narrow range of around $10,300/t this month.

While the market level of LME has not changed much, the exchange rate (TTS) has reached the JPY 128 level per dollar. It has been depreciating by about JPY 5 since the beginning of the month and by about JPY 12 since the beginning of the previous month.

This article has been published under an exchange agreement between Japan Metal Daily and SteelMint.