Source: my coke COKE
Last MondayAmericancasinoguidevideopokerstrategyThe highest level of copper trading in Shanghai reached 88940 yuan / ton, the highest since listing, while international copper futures hit 79670 yuan / ton on the same day, also setting a new high since listing. On the same day, copper futures for COMEX hit 5.Americancasinoguidevideopokerstrategy.1990 USD / lb, LME copper hit 11104Americancasinoguidevideopokerstrategy.5 US dollars per ton, global copper prices hit an all-time high. Since then, global copper prices have remained high and volatile.
How do you view the performance of this round of copper market?
Since October 2023, as the market has become more and more expected to cut interest rates by the Federal Reserve, equity assets such as gold, silver and US stocks, virtual currencies such as bitcoin and basic metals such as copper have been opened successively.AmericancasinoguidevideopokerstrategyThis round of bull market. He believes that in addition to the current good fundamentals, in the long run, in the context of global energy transformation, the demand for copper will continue to grow, but supply will face various challenges, and supply and demand may face a state of long-term shortage. this gives copper a strong ability to hedge against inflation and risks, and attracts a lot of market capital.
In addition, the shortage of warehouse receipts is also the main reason for the surge in copper futures in COMEX.
Copper prices hit a new high after the shock fell, mainly due to the lack of fundamental support. From a macro point of view, although the possibility of a soft landing in the US economy has increased, the expectation of interest rate cuts has also been delayed synchronously, and although the global economy has not yet shown an obvious trend of deterioration, it can not support the super bull market of copper. From the perspective of supply and demand, although supply is facing disturbances and TC costs remain low, production reduction expectations fail, copper production remains high, while indicators such as rising water and inventory show that demand is not strong. From the trading level, the market investment in copper has cooled. On May 15, the position in the main contract of COMEX copper futures began to fall from a high of 188900 hands to about 150000 hands on May 23, which indicates that bullish funds are beginning to retreat, which is also confirmed by the trend of copper futures in COMEX.
Last week, COMEX copper rose as high as $1000 a tonne, mainly due to the limited availability of spot copper for delivery in the United States. In the middle of the week, the initial manufacturing PMI in the United States and Europe exceeded expectations, and the central banks of the United States and Europe both made hawkish remarks. At the same time, due to the substantial increase in margin by CME, copper futures in COMEX fell compared with Shanghai copper on Friday, and prices also adjusted sharply.
From a fundamental point of view, the current fundamentals of copper are intertwined. The spot TC cost of copper concentrate is still low, at US $1.70 / dry ton on May 24th. The disruption to copper supply caused by the shutdown of the copper mine in Panama and the drought in Zambia has not been resolved, and the supply side faces challenges. However, at present, the disturbance at the mine end has not been reflected in the production of electrolytic copper. According to SMM data, the domestic output of electrolytic copper reached 999500 tons in March, the second highest level in history, and reached 985000 tons in April. Although it has dropped somewhat from the previous month, it is still at an all-time high. Downstream demand has not risen at the same time. Copper inventory, SMM data show that the current national copper inventory of 514900 tons, and still maintain the trend of accumulation, but in previous years, seasonal destocking is usually opened in March. From the point of view of the operating rate, from March to April, the operating rates of copper rods, wires and cables, copper tubes, copper plates, foil and brass bars all decreased significantly compared with the same period in 2023, of which the operating rate of wires and cables decreased by more than 10%.
China's domestic car sales fell from April to May compared with the same period last year, the impact of continuous price cuts by car manufacturers gradually receded in the first quarter, the automobile industry may face an off-season in the second quarter, while real estate investment fell sharply by more than 9 per cent year-on-year. At present, global copper inventory is high and continues to rise, domestic copper inventory rose to a new high after the epidemic, LME spot discount reached an all-time high, overseas demand is seriously insufficient, copper supply is loose, supply exceeds demand.
In addition, Asarco, the mining company owned by Grupo Mexico, is planning to restart its copper smelter in the US as copper prices hit an all-time high, according to the latest market news. According to market participants, Asarco is currently in talks with trade unions to restart the Hayden smelter in Arizona and nearby copper mines, as well as the Amarillo refinery in Texas. The reopening of the Hayden smelter will increase copper supplies in the United States.
It is understood that there are only two copper smelters in the United States, namely Freeport McMoran's Miami smelter in Arizona and Rio Tinto's Kennecott smelter in Utah.
At present, Asarco is in negotiations with union representatives and smelters, and it may take a long time to negotiate an agreement based on US mining law and the potential interests of workers. From the perspective of supply, the impact of the commissioning of copper smelters sealed in the United States on global supply mainly has two aspects: first, the current global supply problem is mainly due to the shortage of mines, and the commissioning of copper smelters sealed in the United States may aggravate the tight pattern of global copper supply; second, the tight supply of refined copper in the United States may be alleviated.
Looking forward to the future, the technical form of copper has reached near the 20-day moving average in the near future, and a break may occur next week.
Copper prices are expected to continue to adjust in the short term. Since mid-March, copper prices have risen by more than 25%, and there has been basically no long-term adjustment in this process. Copper prices have accumulated a large mood of adjustment, and this adjustment is expected to be a large-scale and long-lasting adjustment. In the second half of the year, benefiting from the energy transformation, copper has the foundation of a "long bull". Coupled with the current expectations of a soft landing in the US economy, signs that Europe is emerging from recession, and China's continued economic stimulus policies, the pressure on copper prices at the macro level is limited. It is expected that after this round of adjustment, copper prices are more likely to maintain high and wide shocks this year.
In June, the peak season of bulk consumption in China is coming to an end. In the face of the rising prices of copper and other non-ferrous metals, the fear of heights in the lower reaches is heavy, and the short-term purchasing demand is obviously weakened. Mid-term vigilance copper multi-round high and falling "roller coaster" market, the industry in the middle and lower reaches of enterprises need to do a good job in the safety of key raw materials upstream of the industrial chain and price risk management plan.