In the spot market, the current front-month futures contract has changed into a BACK structure, and the spot buyers still maintain the sentiment of holding back the price, and the downstream demand purchase has no more enthusiasm for replenishment. Morning market, holding the mainstream Pingshui copper premium 100~120 yuan/ton, good copper premium 120 yuan/ton above, wet copper supply tension premium 50 yuan/ton above; The deal is not so bad. Close to 10 a.m., with the majority of the market holding merchants take the initiative to lower the offer, the mainstream copper transaction center of gravity down; Mainstream flat water copper premium 70~90 yuan/ton part of the transaction, good copper main transaction near premium 100 yuan/ton, wet copper and non-registered goods are difficult to obtain a cargo, premium 30~50 yuan/ton.
Opinion:
On the macro front, the US dollar index fell below 104 as market expectations of Fed rate hike cooled sharply due to the failure of several banks, including Silicon Valley Bank. Treasury yields also fell sharply as safe-haven buying rushed in, with the 2-year yield at one point down 60 basis points and falling below 4 per cent. Copper varieties in this process by a certain impact, but due to the current close consumption season, so the performance against the fall.
On the mine side, according to Mysteel news, spot copper concentrate TC continued to drop slightly by $1.35 / ton to $76.29 / ton, although overseas interference has subsided, but market participants need time to react, the market is still mainly trading April shipment. After the Indonesian copper mine resumed operations last week, and the Panamanian government successfully negotiated with First Quantum, the Panama copper mine resumed operations. A blockade of Peru's mining corridor has been lifted, disrupting copper mines including Las Bambas as shipments gradually resume. As overseas interference abates, spot TC is expected to usher in an upward trend.
In terms of smelting, although the TC price continues to fall recently and the sulfuric acid price also shows a downward trend, domestic refineries will not fall into the state of loss production temporarily. Domestic electrolytic copper output of 232,200 tons, an increase of 10,000 tons month-on-month. Last week, there were few smelting enterprises undergoing maintenance, which had little impact on production. Other smelting enterprises were normally producing high production, so copper production increased.
In terms of consumption, market consumption picked up significantly last week, and the activity of spot transaction was not bad, which can be verified by the gradual increase in the daily storage volume of Shanghai warehouses. At present, the "gold, silver and silver" consumption season is approaching, the orders of downstream enterprises began to increase, and the copper price failed to rise significantly this week. The focus of downstream procurement moved up, the sentiment of replenishing inventory was slightly strong, and the overall enthusiasm for receiving goods in the market was not reduced, and the reality of weak demand began to turn.
On the inventory front, LME stocks fell 0.42 million tonnes to 71,300 tonnes yesterday. SHFE stocks fell 0.35 million tons from the previous session to 117,400 tons.
International copper, yesterday international copper and LME copper at 6.88, down 1.99% from the previous trading day.
Generally speaking, the downstream procurement has gradually recovered, and has shown a scene of warehousing. The market has a relatively optimistic outlook on future demand, so the current operation is still dominated by stocking up on bargains for the time being. But keep an eye on the potential negative impact on copper prices if consumption does not recover as expected.
