The amount of copper stored inside a bonded warehouse in Shanghai is expected to hit 650,000 tons in next 10 days, a level close to a possible re-export of the metal back into the global markets.

Despite sluggish industrial production, copper has been flowing into the Shanghai warehouse where it is used as a collateral for loans.

From Reuters:

Stockpiles of the metal in Shanghai’s free trade zone have also been climbing, two Shanghai-based sources said, further adding to worries about demand. 

Bonded stockpiles are expected to hit the 600,000-650,000 tonne mark by the end of the month, they said. This is close to record highs seen this time last year and up from 285,000-300,000 tonnes in mid-January.

If past is any predictor of a trend, then February saw robust import numbers that were 137.6% higher then year earlier.

The implication of this latest data is additional evidence to beware of a copper sell-off, a possibility that was explained last week here.