SunSirs: Both Supply and Demand Increased, and Copper Prices Fell Slightly This Week (March 13-17)

Price trend

As shown in the figure above, copper prices fell slightly this week. As of the end of this week, the spot copper quotation was 67,321.67 RMB/ton, down 2.52% the price of from 69,065 RMB/ton at the beginning of the week, and down 7.28% year-on-year.

According to the weekly rise and fall chart of SunSirs, copper prices had risen for 6 weeks and fallen for 5 weeks in the past three months, the recent price of copper was mainly downward slightly.

Analysis review

Macro: The European Central Bank ignored the banking crisis and continued to raise interest rates by 50 basis points, but did not provide guidance on May interest rates; President Lagarde said: "Financial stability is as important as price stability, and we are ready to provide liquidity support.". Wall Street stepped in to rescue the First Republic Bank, with 11 major banks jointly injecting $30 billion; Federal Reserve and Treasury: The bailout shows the resilience of the US banking system, ready to provide liquidity funds.

Supply side: Concentrate supply was tight, and copper concentrate spot TC continued to decline slightly by 1.35 US dollars per ton to 76.29 US dollars per ton. Since the previous week, the Indonesian copper mine had resumed operations. In addition, negotiations between the Panamanian government and First Quantum had also been successful, and the Panamanian copper mine had resumed operations; The blockade of the mining corridor in Peru has been lifted, and transportation of copper mines, including Las Bambas, has gradually resumed. As overseas interference weakens, it is expected that spot TC will soon usher in an upward trend. The domestic electrolytic copper output was 232,000 tons, an increase of 11,000 tons compared to the previous month. Last week, there were few overhaul smelting enterprises, and the output was not significantly affected.

Demand side: Under the current "Golden March Silver April" consumption season, orders from downstream enterprises had begun to increase, but the copper price had not shown a significant upward trend this week. But the copper price had not shown a significant upward trend this week. The focus of downstream procurement had shifted upward, with a slightly strong replenishment sentiment. The overall enthusiasm for entering the market and receiving goods had not decreased, and the reality of weak demand had begun to shift.

Market outlook

To sum up, as of the 17th, downstream procurement had gradually resumed and had shown a picture of destocking. The market was relatively optimistic about the future demand outlook. However, recent bank ran on overseas banks had intensified market concerns about overseas recession, and copper prices had been hit. Beware of the further spread of the negative impact of the overseas banking system and the failure to meet expectations of good demand. Copper prices are expected to have a low volatility trend at low levels in the short term.

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