Price trend

As shown in the figure above, copper prices rose slightly this week. By the end of this week, spot copper had offered 68,605 RMB/ton, up 3.27% from the price of 66,433.33 RMB/ton at the beginning of the week, and down 3.03% year on year.

According to the weekly ups and downs chart of SunSirs, in the past three months, the copper price rose for 6 weeks, fell for 5 weeks, and remained unchanged for 1 week. Recently, the copper price has risen slightly.

Analysis review

Macro: the consumer price (cpi) of the United States rose less than expected last month. The official inflation rate fell to 7.7%, lower than 8.2% in August, and lower than 7.9% expected by economists. Senior officials of the Federal Reserve supported slowing the pace of interest rate increase. A lower peak in US interest rates will help metals as higher interest rates restrain economic activity and boost the US dollar. According to the data released by the National Bureau of Statistics of China, in October, the demand of some industries increased, and the national PPI rose slightly month on month. However, affected by the high comparison base in the same period last year, it turned from rising to falling year on year.

Supply side: the supply of copper concentrate was loose, and TC continued to rise. The new production capacity was put into operation, but the delivery rate of supply pressure was not as fast as expected due to disturbances such as maintenance and equipment transformation. The market inventory was still at a low level, which still supported the price.

Demand side: Affected by the soaring copper price, the downstream was afraid of high prices, and the terminal procurement was weak. In addition, it is expected that the number of imported goods will increase rapidly, leading to a weaker price comparison. The consumption of scrap copper rods was also weak, reflecting the continuous weakening of terminal demand. On the whole, the operating rate of North China and South China has decreased due to the epidemic. In addition, the winter in the north has increased the off-season factors. The consumer side is increasingly unable to support rising prices, and the contradiction between supply and demand has increased.

Inventory: On November 10, Shanghai Futures Exchange copper rose 5,779 tons to 25,006 tons from the beginning of the week. LME copper inventory fell 4,525 tons to 80,025 tons, down 5.1% from the beginning of the week.

Market outlook

To sum up, the current macro pressure is slowing down, with strong support from the supply and demand side. After breaking through the previous shock range, the copper price is likely to continue to rise in the short term, with the pressure at 70,700 RMB/ton.

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