Price trend

As the chart above shows, copper prices rose slightly this week. As of the end of this week, the spot copper price was 63,000 RMB/ton, up 2.56% from 61,428.33 RMB/ton at the beginning of the week and down 10.39% year-on-year.

According to the weekly rise and fall chart of SunSirs, in the past three months, it has risen for 4 weeks and fell for 8 weeks. The copper price has rebounded slightly after the recent sharp decline.

Analysis review

On the macro side, the July CPI announced by the United States on the 10th increased by 8.5% year-on-year, down sharply from 9.1% in the previous month. The PPI announced on the 11th increased by 9.8% year-on-year, the previous value increased by 11.3%, and the chain fell by 0.5%.U.S. inflation data weakened marginally, and expectations for further substantial Fed tightening were not strong.

Supply side: There were still disturbances in the main producing areas of copper mines, and the output of overseas mines declined. Domestic refined copper, the high temperature in many places in the country since August has led to power shortages, coupled with rising concerns about the expansion of sulfuric acid storage, the production of electrolytic copper has been affected. On the supply side, copper smelting in Anhui and Zhejiang were affected, and downstream copper consumption was also affected. The supply side was more affected. The domestic copper concentrate port inventory level was still at a high level, and the domestic mine supply was still loose.

Demand side: The recovery of terminal demand was not obvious, and the primary processing market had picked up. On the real estate side, due to the "loan suspension" and the financing problems of private real estate companies, market confidence was insufficient, supply and demand were weak, and both front and back end data were poor. In the home appliance sector, both internal and external demand were weak, or it was difficult to perform well. The proportion of copper used in new energy vehicles in the automotive sector was not high, which had limited traction on the overall demand.

News: In August 2022, according to market news, it was reported that copper purchases and storage were again reported, and the market stated that its purpose was to supplement the amount reduced by selling storage in 2021.

Market outlook

To sum up, the regeneration of overseas copper mines is disturbed, and the power cut affects some copper production, but the demand is still weak. According to the news of copper purchase and storage in the market, it is expected that the copper price will mainly fluctuate and rebound in the short term.

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