Price trend

According to the monitoring data of SunSirs, the copper price rose first and then fell in September. The copper price at the beginning of the month was 61,760 RMB/ton, and the copper price fell to 61,568.33.33 RMB/ton at the end of the month, with an overall decrease of 0.31% and a year-on-year decrease of 11.46%.

According to the futures and spot charts of SunSirs, in September, the copper spot price was basically higher than the futures price, the main contract was the expected price two months later, and the main basis difference became larger, which was bad for buying hedging.

Analysis review

According to LME inventories, LME copper inventories first fell and then rose in September, which was higher than that in August.

Macro: In September, the European Central Bank raised all three major interest rates by 75 basis points, the first significant rate hike since 1999 by 75 basis points. The US CPI in August exceeded expectations. The US CPI in August rose by 8.3% year-on-year, which was higher than the market expectation of 8.1%; the month-on-month increase was 0.1%, and the market expected a decline of 0.1%. At 2 a.m. on Thursday, September 22, Beijing time, the Federal Reserve announced its September interest rate resolution as scheduled, raising interest rates by 75 basis points again.

Supply: The global copper concentrate supply was generally stable and loose. Spot concentrate processing fees have continued to increase and are currently over 80 US dollars, slightly better than the 70-75 US dollars in the first half of the year. According to data from the National Bureau of Statistics, the domestic refined copper output in August was 917,000 tons, a year-on-year increase of 3.9%; the cumulative output from January to August was 7.118 million tons, a year-on-year increase of 2.6%.

Demand: In the first three quarters, domestic demand generally performed well. The investment in electricity and new energy vehicles continued to grow at a high speed, especially in solar and wind power; Household appliances remained flat on the whole, with a slight positive increase in the output of air conditioners; The real estate continued to grow negatively, and there was no sign of stabilization.

Market outlook

To sum up, the US dollar still maintains a strong momentum despite the Federal Reserve's interest rate increase. Under the expectation that the Federal Reserve will continue to raise interest rates and the European and American economies will continue to differentiate, the dollar index is expected to continue to rise this year. In this context, the overall copper price will bear some pressure. The copper concentrate output at the supply end was stable, and the concentrate processing cost continued to increase slightly. The recovery of global copper explicit inventory weakened the support of low inventory on copper price. On the demand side, October is the traditional peak season in China, and demand is expected to rise. On the whole, the macro expected pressure remains, the supply and demand reality continues to be tight, it is expected that the copper price will fluctuate to be strong in October.

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