Our reporter Zhao Ziqiang
Trainee reporter Liu Hui
On November 24, the National Bureau of Statistics announced the market price changes of important means of production in the circulation field in mid-November. Compared with the first ten days of November in mid-November, 24 kinds of product prices increased, 24 kinds of products fell, and 2 kinds remained unchanged. Among them, non-ferrous metals rose in different ranges, electrolytic copper rose by 2.8%, aluminum ingots rose by 3.4%, lead ingots rose by 2.8%, and zinc ingots rose by 1.8%.
For this round of rebound in non-ferrous metal prices, the reporter sorted out the opinions of all parties and found the following four factors:
First of all, the macroeconomic fundamentals are stable and improving.
At the end of October, my country’s third-quarter GDP and other economic data were released. In the third quarter, my country’s GDP growth rate reached 3.9%, an increase of 3.5 percentage points from 0.5% in the second quarter. The endogenous driving force drives the economy to improve, which in turn drives up the price of base metals.
Chen Xuesen, member of the Standing Committee of the Party Committee and Vice President of the China Nonferrous Metals Industry Association, said at a press conference on the economic operation of the nonferrous metals industry at the end of October that in the first three quarters of this year, the Party Central Committee and the State Council issued a series of targeted policy measures in a timely manner to help The real economy has come out of the predicament, and industrial resilience and development confidence have been further enhanced. The domestic production capacity that was suppressed due to various reasons in the early stage was gradually released. Domestic copper, aluminum, lead-zinc and other smelting production was generally stable, and the operating rate was good, which effectively stimulated the growth of related products.
Secondly, since November, the US dollar index has fallen, and non-ferrous metal prices have rebounded.
The Federal Reserve’s November interest rate meeting on November 3 and the October non-agricultural employment data released by the United States on November 4 all revealed that the pace of interest rate hikes will be slowed down in the future. Expectations of a slower pace of interest rate hikes. All of the above are important time nodes for the current round of copper prices and other non-ferrous metals to rise.
Chen Li, chief economist and director of the research institute of Chuancai Securities, said in an interview with a reporter from the “Securities Daily” that as the market’s interest rate hike expectations have fallen, inflationary pressures in the United States have begun to ease, which will support the upward movement of copper prices.
Third, the tight spot pattern supports prices.
Since 2022, the new output of copper mines has been lower than expected, and domestic refined copper stocks are at historically low levels, and it is difficult to see obvious accumulation in a short period of time.
The downward trend of global copper inventories is also relatively obvious. From the data point of view, since 2018, except for the inventory in 2020, copper inventories have fallen in other years. In 2018, 2019, and 2021, the inventories have decreased by 260,000 month-on-month. tons, 180,000 tons, and 310,000 tons. At this stage, the global copper dominant inventory has dropped by about 180,000 tons to 246,000 tons compared with the end of 2021.
Fourth, from the perspective of demand, non-ferrous metals are widely used in high-boom industries such as power equipment, new infrastructure, and new energy vehicles.
New infrastructure relies heavily on non-ferrous metals such as copper and aluminum. For example, intercity high-speed railways and urban rail transit need to lay copper cable contact wires. UHV requires a large number of aluminum cables, transformers and galvanized power fittings. 5G base station construction Copper foil is needed, new energy vehicles and charging pile consumables have a large demand for copper, and projects such as big data centers require a considerable number of electronic components.
For example, according to data released by the China Association of Automobile Manufacturers, in October this year, my country’s new energy vehicles continued to maintain rapid growth, with a market share of 28.5%. In addition, the “Report of the State Council on the Development of the Digital Economy” issued by the National Development and Reform Commission on November 16 made it clear that we should firmly grasp the initiative in the development of digital technology, grasp the opportunities of a new round of technological revolution and industrial transformation, and vigorously develop digital economy. economy. The continued high prosperity of these industries may be one of the factors driving the rise of non-ferrous metals in this round.
What will be the trend of non-ferrous metal prices in the later period?
Chen Xuesen said that with the implementation of a package of national economic stabilization policies and the formation of more physical workloads, the national economy will continue to resume its growth trend, which will continue to drive the recovery of demand for non-ferrous metals and support the steady and sound development of the industry.
Chen Li believes that copper demand has relatively strong resilience driven by power investment. It is expected that copper prices will have upward momentum in the short term against the background of low inventory, but overseas recession expectations and demand-side recovery need to be considered.
Xia Yingying, director of non-ferrous metals at the Nanhua Research Institute, told the “Securities Daily” reporter that looking forward to the market outlook, before the Fed’s interest rate decision in December, copper prices may mainly follow, showing a volatile market, and the US dollar index may have some support around 105. Fundamentals Power and power grid investment may have a seasonal peak season in December, which will help boost copper demand, but the resistance level of 68,000 yuan per ton still exists. Therefore, it is believed that the possibility of a big rise in the future is relatively small, and the volatility is still the main one.
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