1、 Trend analysis

As shown in the above figure, copper prices have fluctuated and risen this week. As of the end of this week, the spot copper quotation is 69358.33 yuan/ton, an increase of 0.57% from the 68963.33 yuan/ton at the beginning of the week and a year-on-year increase of 9.4%.

According to the weekly rise and fall chart of Business Society, in the past three months, the price has dropped by 4% and increased by 8%. Recently, copper prices have still slightly increased.

LME copper inventory

Macroscopically, new economic data from Europe and the United States has been released. The PMI values of European and American countries in August were lower than market expectations, reducing market expectations for further interest rate hikes by the European and American central banks and raising expectations for possible interest rate cuts next year. Driven by China’s stimulus policies, risk appetite has increased, while July’s consumption data showed strong performance, providing upward momentum for the non-ferrous metal market.

On the supply side: The spot processing fee TC for imported copper concentrate has fallen, but it is still at a high level, driving smelting enterprises to improve capacity utilization, and refined copper production continued to increase in August. The domestic supply of recycled copper has tightened, the profit from imported recycled copper has narrowed, and the price difference between refined and waste has rebounded. Last week, the domestic electrolytic copper production was 243000 tons, an increase of 4000 tons compared to the previous week. The increase in production during the week was mainly due to the impact of last month’s smelting enterprise maintenance on the gradual recovery of production, with most smelting factories completing maintenance and maintaining normal high production.

On the demand side: Partial orders from the power grid will be delivered in August, boosting the industry’s operating rate; Air conditioning is gradually entering the off-season, and consumer support is weakening; The policy of ensuring the delivery of real estate has boosted the completion data, but the front-end data is still weak and faces the risk of weak follow-up. It is still necessary to pay attention to the implementation of the policy; The demand for electronics is slowly recovering. At present, consumption is still resilient, and downstream procurement is active when copper prices fall, forming price support under low inventory conditions.

In summary, at the macro level, there is a possibility that the US dollar will continue to strengthen in the short term, with significant pressure on the external market. However, in China, it is approaching the peak demand season, and downstream buying is significantly boosted when prices fall. It is expected that copper prices will continue to fluctuate strongly.