Source: Huawen Futures

Recently, there have been frequent domestic favorable policies, stimulating the demand for base metals such as copper, and copper prices have stabilized and rebounded. After a slight adjustment, the main contract of Shanghai copper regained its upward trend again, rising more than 2% in intraday trading today, reaching as high as 82440 yuan, just a step away from the 18-year high of 82460 yuan set on April 30. The main international copper contract also rose more than 2%, hitting a session high of 73610 yuan. On April 30th, the main contract of international copper reached a record high of 73640 yuan since its listing.

Huawen Futures Investment and Research team said that recently, domestic policies have frequently released positive signals, including the abolition of real estate purchase restrictions in some key cities and the upcoming issuance of ultra-long-term special treasury bonds.ChaoscrewslotThe expectation of metal demand. At present, copper prices are at historically high levels, and most of the boost to copper prices caused by supply-side disturbances has been reflected in existing copper prices, while the impact of macro news on copper prices continues in the expectation that the Federal Reserve will eventually cut interest rates.

At present, domestic copper concentrate processing fees remain low, but the impact on refined copper supply is still to be tracked, and the impact is limited at present. Downstream demand has been suppressed by high copper prices, social inventory has been difficult to significantly remove, as of the beginning of the week inventory decreased slightly, but the extent is limited, the recent spot discount has narrowed, the current maintenance of a small discount situation. (source: Mandarin Finance)

In terms of international copper, Comex copper futures climbed again to 4 on May 14.Chaoscrewslot. 8500 US dollars, a two-year high. However, some analysts warn that copper futures have entered the overbought zone after rising about 29.78 per cent in the past three months. John Caruso, a senior market strategist at RJO Futures, said that while he was still firmly optimistic about the direction of Comex copper futures prices, he also admitted that "copper futures are now completely overbought." (source: Bloomberg)

In European trading today, spot copper prices in London rose nearly 2 per cent to a record $10082.4 since April 2022, up 24.52 per cent in the past three months, while London copper futures rose 1.81 per cent to $10185.5, up 24.26 per cent over the past three months. (source: LME)

Analysts at Pave Finance said, "Copper prices have soared recently, reflecting the market's optimism about the U.S.-led global economic recovery, supported by a rebound in the Chinese economy. In addition, investors who want to profit from persistent inflationary pressures have also shown demand for copper. However, they see changes in copper prices over the past three months as the preferred indicator of overheated sentiment, as any change of more than 25 per cent is seen as a sign of extreme sentiment. Now, Comex copper futures, the most active in the past three months, have risen more than 29 per cent, which clearly indicates that copper prices near all-time highs have entered the overbought zone. " (source: Bloomberg)

However, if copper prices start to fluctuate in a narrow range and do not fall sharply, it could be a sign of consolidation before another rebound, which is good for the global economic outlook. But if copper prices reverse from their highs, it would be a warning sign that economic conditions, dragged down by the credit crunch, could slow significantly. It also means that the stock market may face a reversal and there may be signs of the allocation of capital to two-year Treasuries. Although the alarm has not been sounded yet, we should remain vigilant. " (source: Bloomberg)

The World Bank (The World Bank) recently released its official report "Commodity Market Outlook 2024", which said that the bank's metal price index expects metal prices to remain stable in 2024-25. Nickel, iron ore and zinc prices are expected to have the biggest year-on-year declines of 21 per cent, 9 per cent and 6 per cent respectively in 2024. However, copper and tin prices are expected to rise slightly by 5 per cent and 4 per cent respectively, while aluminium is expected to rise slightly by 2 per cent. Looking ahead to 2025, aluminum and tin prices are expected to rise by a further 4 per cent, while iron ore and lead prices are expected to continue their downward trend. At the same time, nickel and zinc prices are expected to partially rebound, while copper prices are expected to stabilize. (source: world Bank)

Strong industrial and infrastructure investment in China should help offset falling demand for some metals, including copper, in the weak real estate sector, the report said. Demand outside China is likely to remain sluggish as rising interest rates continue to affect economic activity. In addition, the development of AI technology and the growing production of clean energy technologies should support the demand for certain metals such as copper, tin and nickel. (source: world Bank)

The world's major consumers of copper include China, the United States, Germany, Japan and South Korea. Last year, China's refined copper consumption reached 15.22 million tonnes, accounting for 56.2 per cent of global copper consumption. Citigroup forecasts that spot copper prices will continue to rise in the coming months, reaching $10000 a tonne by the end of the year and climbing to $12000 by 2026. However, China's copper production is not high, accounting for only 8 per cent of global copper production. This means that China is highly dependent on imports of copper resources. Last year, China imported 3.511 million tonnes of refined copper and 27.54 million tonnes of copper concentrate, which is more than 70 per cent dependent on copper resources. In the face of insufficient production capacity and huge demand, coupled with the current surge in copper prices, China's home appliances, new energy vehicles, electronics and other industries may suffer a major impact. (source: Cnyes.com)

Zhang Jingjing Investment Consulting No.: Z001921