Tight Spot Circulation Short-Term or Limit Copper Prices Down Space

Since copper has become a necessity in people’s lives, copper prices have also become the focus of some enthusiasts and business people’s daily production concerns.

According to ZMS team data, Shanghai copper fell back from its high level some time ago.

The current month contract weekly average settlement price of 62,944 yuan / ton.

The average daily decline of 328 yuan / ton.

The previous week’s average price was reported at 64110 yuan/ton, down to 1166 yuan/ton ringgit, an accumulated drop of 1.82%.

This is certainly one of the more interesting ups and downs for copper prices.

On the foreign market, copper is finishing on the strong side after a high level retreat.

The average price of LME copper futures in the first four trading days was reported at $7469.75/mt, up $0.5/mt on average daily.

Last week’s average price was reported at $7589.25/mt, down $119.5/mt ringgit, a cumulative decline of 1.57%.

It is actually quite stable in this regard. After all, copper as a necessity in people’s daily lives.

Especially in the use of cables, definitely accounts for a large part.

The picture shows a variety of copper core cables

Here we will look at several aspects such as supply spot and demand to understand some of the impact of copper prices on cable production and use.

On the spot side, the high spot premium inhibits downstream consumption.

With the downstream fear of high buying sentiment under the influence of poor market trade atmosphere is sluggish, the real price transaction weak win.

From the above data, we can understand the approximate amount of copper used in the cable.

According to the China Cable Industry Association, the main business income of 100 million yuan of copper used in electric motors is about 100 tons.

The motor industry can be roughly divided into the generator industry and the motor industry.

The ratio of their copper use is about 1:7.

In recent years, the amount of copper used in the wire and cable industry has become saturated.

This has a lot to do with the widespread use of new technologies and materials in the communications industry.

According to the China Cable Industry Association statistics.

The main business income of 100 million yuan of wire and cable with copper in the amount of about 450 tons.

According to the China Cable Industry Association wire and cable branch statistics.

The amount of copper used in the electromagnetic wire industry accounted for 25% of the entire wire and cable industry with copper.

Communications cable industry with copper accounted for 3% of the entire wire and cable industry with copper.

Bare copper wire industry with copper accounted for 7% of the entire wire and cable industry with copper.

According to the statistics of China Cable Industry Association’s high-voltage switch branch.

The amount of copper used in high-voltage switch of 100 million yuan is about 70 tons.

According to the China Cable Industry Association, the amount of copper used in the transformer industry with a main business income of 100 million yuan is about 50 tons.

On the supply side, the supervisory board of Chilean mining company Antofagasta’s Los Pelambres copper mine reached a new contract agreement with the company, avoiding the risk of a strike.

However, the production of major copper mines in Chile and Peru has been continuously reduced.

And smelters are at risk of disruption under the impact of the European energy crisis.

The domestic mine side of the interference is reduced, copper concentrate supply is loose background, most smelters production enthusiasm increased.

October electrolytic copper production is expected to increase.

The import window will open and imported copper will flow in one after another, which may push the inventory to gradually increase.

However, crude copper supply is tight, domestic supply increment is very limited and faces greater uncertainty.

Combined with the low level of bonded inventory, import regulation space is limited.

The spot circulation to maintain a tight pattern.

On the demand side, the domestic power grid, infrastructure in the fourth quarter to continue to accelerate the force, automotive production and sales stable.

In particular, the new energy vehicles exempted from vehicle purchase tax policy continues to be implemented until the end of 2023.

It will continue to stimulate the consumption of copper for new energy vehicles.

September domestic new energy vehicle sales of 708,000 units, an increase of 99% year-on-year.

However, the real estate Golden Nine is not enough color, home appliances are dragged down, copper tube start rate is less than expected.

With the traditional peak season near the end of the silver ten. The peak season color is very poor compared to previous years.

Therefore, the market trading performance is relatively cold, some copper rod factory began to stop furnace.

In a wait-and-see situation, demand recovery is far less than expected.

Inventory, Shanghai copper inventory continued to rise, accumulating 25,820 tons to 89,566 tons, a 77.57% increase in the ring.

It was the highest level since July, but still lower than the peak of 167,951 tons in March last year.

On the foreign side, copper stocks in Lund fell during the week, accumulating 8325 tons to 137,325 tons, down 5.72%.

Overall, copper prices returned to fundamentals.

Domestic Shanghai copper fundamentals are healthy, although copper production is expected to increase, but the amount released is limited.

And the spot circulation maintains a tight pattern, with the focus still on low inventory and high lift.

In addition, the domestic photovoltaic industry, power grids, infrastructure to accelerate the power.

And new energy vehicle production and sales data is bright, greatly boosting the consumption of copper.

Thereby providing strong support for copper prices.

Moreover, the domestic policy for the prevention of epidemics is expected to show signs of improvement, supporting prices to rise.

The current strong spot copper promotion, the market to maintain a tight pattern. In the short-term may limit the price decline space.

The above is some news and some views about the recent copper price.

Welcome to communicate with ZMS’ cable team together.

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And products that have undergone strict manual qualification audits and are trustworthy.