Price trend

As shown in the above figure, copper prices fell first and then rose this week. As of this weekend, the spot copper quotation was 67,813.33 RMB/ton, a decrease of 0.43% from the beginning of the week's 68,108.33 RMB/ton and a year-on-year decrease of 2.61%, which was equivalent to the same period last year.

According to the weekly rise and fall chart of SunSirs, copper prices had fallen for 5 weeks and risen for 7 weeks in the past three months, with a slight decline in recent times.

Analysis review

According to data released by the London Metal Exchange (LME), LME copper inventory had recently slightly declined, with 157,325 tons of LME copper inventory as of the weekend.

Macroscopically, the macro atmosphere had clearly turned bearish. The unexpectedly strong growth rate of US retail data in December had put pressure on expectations of early interest rate cuts, and the US dollar index had soared to a one month high.

Supply side: Customs data shows that China's copper imports in 2023 were 5.5 million tons, a year-on-year decrease of 6.3%. Due to the increase in domestic production and the strengthening of the US dollar, import costs had increased. Continuous disturbance at the mining end, tight crude copper, and accelerated deterioration of zero single TC in copper concentrate will inhibit the release of refined copper.

On the demand side: Due to the approaching Spring Festival and the holiday of manufacturers, the market trading atmosphere was relatively light. There were many high priced goods available, but their attractiveness was insufficient, resulting in weak spot consumption.

Market outlook

In summary, the macro outlook was pessimistic, with tight supply and weak demand. In the short term, emotional fluctuations and the off-season constrained the upward potential of copper prices, but the tight copper mine and a rapid decline in TC limited the downward potential. In the short term, copper prices will maintain a weakly volatile trend.

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