Price trend

As shown in the above figure, copper prices rose first and then fell this week. As of this weekend, the spot copper quotation is 80,533.33 RMB/ton, an increase of 0.66% from the beginning of the week at 80,001.67 RMB/ton, an increase of 9.08% from the beginning of the year, and a year-on-year decrease of 0.89%.

According to the weekly chart of SunSirs, copper prices have fallen for 2 weeks and risen for 9 weeks in the past three months, with a slight increase this week.

Analysis review

LME copper inventory

According to data released by the London Metal Exchange (LME). LME copper inventory has slightly increased, with 94,325 tons of LME copper inventory as of the weekend, up 4.08% from the beginning of the week.

Macroscopically, the non farm payroll added 147,000 new jobs in June (expected to be 110,000), with a total increase of 16,000 from April to May; The unemployment rate has dropped to 4.1% (expected 4.3%), and JOLTS job vacancies are 7.769 million (higher than expected 7.3 million), indicating that the labor market remains resilient. The ISM manufacturing PMI for June was 49 (the fourth consecutive month of contraction), but slightly higher than expected at 48.8, reflecting weakness in the manufacturing industry but not further deterioration. Federal Reserve Powell has not ruled out the possibility of a rate cut in July, but emphasized the need to observe data.

Supply side: Recently, there have been reports of supply disruptions in copper mines in Peru, exacerbating market concerns about the vulnerability of the mining sector and providing bottom support for copper prices. The shortage of copper mines is severe, and domestic refineries may start reducing production in the second half of the year to further alleviate supply pressure.

On the demand side, the enthusiasm for terminal procurement decreases during the off-season, but the high growth of power grid investment boosts copper consumption, resulting in strong demand resilience.

Future outlook:

In summary, under macroeconomic pressure and fundamental support, copper prices are expected to remain volatile at a high level in the short term. Attention should be paid to the further impact of the off-season demand, but the shortage of mining resources and the resilience of power grid consumption provide support for copper prices.

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