Price trend
As shown in the figure above, copper prices fell slightly this week. By the end of this week, spot copper had offered 66,255 RMB/ton, down 1.54% from the price of 67,288.33 RMB/ton at the beginning of the week, and down 5.51% year on year.
According to the weekly ups and downs chart of SunSirs, in the past three months, it has risen for 6 weeks, fell for 5 weeks, and remained unchanged for 1 week. Recently, the copper price has risen slightly, and now it has slightly recovered.
Analysis review
Macro: The number of Americans applying for unemployment benefits hit a new 10 month high, indicating that the job market was cooling down and supporting the Federal Reserve to slow down interest rate hikes. Macroscopically, the trend is slowly improving, and may be repeated in the short term, but the overall trend is still good.
: The overseas mine side was disturbed frequently, but the duration was relatively short, which had not had a substantial impact on the output. Copper production in Peru continued to increase in October, and the processing cost was further increased compared with the same period last year. Guangxi Jinchuan, Yunxi and other smelters were overhauled. Southeast Copper started electrolytic maintenance on December 9. Guorun will stop production next week, and a new production line will be opened in April next year. Overseas production is also not good. Onsans Smelter has been producing abnormally since August. It will recover after major repair next spring. Codelco's two smelters were shut down. Glencore lowered its 2023 production guidance for all bulk commodities it mined. Glencore expects to produce 1.04 million tons of copper next year, lower than 1.06 million tons this year. The domestic refined copper output in November continued to fall short of expectations, and is expected to fall back in December. The low inventory situation at home and abroad is difficult to change, which also supports copper prices.
Demand side: The demand side was weaker, especially in South China. Because there are many export-oriented enterprises, the market consumption is particularly bleak now. Since the end of December, enterprises will begin to take holidays in succession.
Inventory: On December 8, Shanghai Futures Exchange copper fell 106103 tons to 10603 tons from the beginning of the month. LME copper inventory fell 900 tons to 87,375 tons, down 1.01% from the beginning of the month.
Market outlook
To sum up, the current market supply and demand are weak. In November, the low refined copper production continued to be tight, and the demand also weakened. The domestic epidemic prevention and control has been gradually relaxed, but in the context of the global economic recession, the demand outlook is still bleak. It is expected that copper price will fluctuate and weaken in the short term.
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