Price trend

As shown in the above figure, copper prices hadslightly increased this week. As of the end of this week, the spot copper quotation was 69,418.33 RMB/ton, an increase of 0.89% from the beginning of the week's 68,803.33 RMB/ton, and a year-on-year increase of 3.89%.

According to the weekly rise and fall chart of SunSirs, copper prices had fallen for 3 weeks and risen for 8 weeks in the past three months, with a slight rebound in recent times.

Analysis review

LME copper inventory

According to data released by the London Metal Exchange (LME), LME copper inventory had recently slightly declined, with 165,450 tons of LME copper inventory as of the weekend.

Macroscopically, the annualized growth rate of the US core PCE price index for the quarter did not meet expectations, and the US dollar index fell significantly. The Federal Reserve maintained interest rates unchanged in December and is expected to cut rates three times in the next year. The State Council and other departments have issued a package of measures to stabilize the economy, in order to hedge against economic, monetary and fiscal policies, increase investment in infrastructure, increase support for real estate, and focus on consumer policies.

Supply side: The first quantum cobre Panama copper mine ceased production, and Anglo American Resources lowered its production by 200,000 tons next year, weakening market expectations for a slight oversupply of copper next year. Some northern mines and smelters in China had reduced production due to weather conditions. Chinese smelting enterprises increases their raw material procurement next year, and the year-on-year growth rate of refined copper production is relatively high.

On the demand side, the downstream high price capacity had weakened, the operating rate of copper rods had declined, and domestic copper inventories had slightly increased. The marginal decline in terminal consumption, but companies were buying stocks on dips.

Market outlook

In summary, the domestic copper market had fallen into a situation of weak supply and demand, and actual demand was difficult to find an increase. Downstream traders had a strong wait-and-see attitude of "looking more and purchasing less", and high prices had also suppressed more elastic demand downstream. It is expected that copper prices will continue to fluctuate at high levels in the short term.

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