1、 Trend analysis
According to monitoring data from Shengyi Society, copper prices first rose and then fell this week. As of the 17th, copper prices were reported at 102035 yuan/ton, an increase of 3.2% from the beginning of the week and a year-on-year increase of 34.05%.
Copper weekly fluctuation chart
According to the weekly chart of Shengyi Society, copper prices have risen slightly this week, with a decrease of 7 and an increase of 6 in the past three months.
LME copper inventory
According to data released by the London Metal Exchange (LME). LME copper inventory has slightly increased, with 400225 tons of LME copper inventory as of the weekend, up 0.27% from the beginning of the week.
Macroscopically, the achievement of the ceasefire agreement is undoubtedly a shot in the arm for market sentiment. It directly alleviated the extreme concerns of the market about the interruption of shipping in the Strait of Hormuz, leading to a decline in crude oil prices and thereby reducing the cost pressure on industrial metals. The US dollar index continued its 9 consecutive declines, further providing upward momentum for metals priced in US dollars.
Supply side: The global decline in copper ore grades is a long-term structural problem, and the decline in production in major producing areas such as Chile has become a fact. More importantly, the copper concentrate processing fee (TC) has fallen to negative values (-78 USD/dry ton), which means that smelters are losing money for every ton of electrolytic copper produced, inevitably forcing them to lower their operating rates and tighten the supply of refined copper from the source. The sulfur shortage concerns caused by the situation in the Middle East are becoming a new variable affecting supply. Large wet copper producing countries such as the Democratic Republic of Congo are highly dependent on imported sulfuric acid. Once the supply is disrupted, it will directly restrict the global production of electrolytic copper.
On the demand side: Although the domestic GDP grew by 5.0% year-on-year in the first quarter and the contribution rate of domestic demand increased, the specific copper consumption showed insufficient momentum. The real estate market remains sluggish and difficult to form an effective driving force; And the photovoltaic sector has also brought negative news, with a year-on-year decrease of 20.60% in solar cell production in March. The weakness of traditional pillar industries has led to a lack of solid buyers for high copper prices.
New energy vehicles and high-end manufacturing industries such as AI computing power and robots have maintained a high level of prosperity. China Minmetals Corporation predicts that refined copper consumption in China will continue to maintain an average annual growth rate of 3.7% in the next decade, with this increase mainly coming from these new quality production areas. However, the incremental growth in emerging fields is not yet sufficient to fully offset the decline in traditional real estate infrastructure, and is extremely sensitive to prices.
In summary, mining interference and potential sulfur shortages have established a solid cost floor, and Citibank’s increase in target price to $13000 reflects the consensus of institutions on long-term shortages, which limits the potential for deep price declines. But in the context of weak spot premiums and less than expected destocking, the rise in copper prices is also limited. Copper prices are currently in a subtle ‘high volatility period’. It is expected that copper prices will continue to fluctuate at a high level.
| http://www.thiourea.net |