Research report text
on MondayShanghai CopperThe 2302 contract fluctuated upwards, up 0.89% to close at 66010 yuan/ton; the international copper 2302 contract also fluctuated, up 0.87% to close at 58900 yuan/ton. Trading in the LME was suspended during the Christmas break. On Monday, the spot price of electrolytic copper in Shanghai was quoted at a premium of 150 yuan/ton to 350 yuan/ton for the 2301 contract of the month, with an average price premium of 250 yuan/ton, a sharp drop from last week.
Near the end of the year, affected by the rebound of the epidemic, some factories closed their holidays early, and downstream demand shrank, resulting in a decline in spot premiums. In addition, at the end of the year, smelters need to clear their warehouses, and their shipments have increased. Recently, copper inventories have increased slightly. Over the weekend, copper inventories in mainstream areas across the country increased by 3,500 tons to 79,700 tons. The total inventory is still lower than the 86,000 tons in the same period last year. Level.
On the macro side: The hawkish member of the European Central Bank and the head of the Dutch central bank said that the tightening cycle has entered the “second half” and will continue to raise interest rates rapidly. The Governor of the Bank of Japan reiterated that he has no intention of exiting the super-loose policy. National Health and Medical Commission: Renamed the new crown pneumonia as a new type of coronavirus infection, and implemented “Class B and B control” from January 8; cancel the nucleic acid testing and centralized isolation of all personnel coming to China after entering China. The Central Office and the State Office issued a notice: Do a good job in the relevant work during the New Year’s Day and Spring Festival in 2023 to ensure that the adjustment and transition of epidemic prevention and control measures are smooth and orderly.
Industry: Chile’s Codelco, the world’s largest copper producer, said on Friday that it will launch an austerity plan aimed at boosting its short- and medium-term earnings and optimizing production and investment by 2027. The state-owned miner cut its production target for 2022/23 in October due to lower prices and lower ore grades, saying its lower output levels would persist for several years. The company expects copper production to be between 1.435 million tonnes and 1.465 million tonnes in 2022, down from a previous forecast of 1.49 million tonnes to 1.51 million tonnes. Superimposed on the recent Cobre, an important mine under First Quantum, was ordered to suspend operations by the Panamanian government, and the large-scale mass protests in Peru again led to the possibility of production cuts in Las Bambas, and frequent disruptions to copper mines in South America, potential supply disturbances cannot be ignored.
The current disturbance in overseas mine supply has boosted copper prices. The domestic end of the year is approaching the impact of the superimposed epidemic, and the actual demand of the terminal is weak. Although there is a slight increase in weekend inventory, it is at a historically low level. Low inventory has formed a certain support for copper prices. There is support and pressure on copper prices, and it is expected to maintain a volatile pattern in the short term.
Operational recommendations: unilateral advice to wait and see.
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