1、 Trend analysis

As shown in the above figure, copper prices have fluctuated in a narrow range this week. As of the end of this week, the spot copper quotation is 69900 yuan/ton, an increase of 0.09% from the 69835 yuan/ton at the beginning of the week and a year-on-year increase of 16.43%.

According to the weekly rise and fall chart of Business Society, in the past three months, the price has dropped by 4% and increased by 8%. Recently, copper prices have been fluctuating.

Macroscopically, the US ISM manufacturing PMI recorded 46.4% in July, slightly lower than expected and shrinking for nine consecutive months; Manufacturing activity in the eurozone experienced its fastest contraction since May 2020 in July. The recent PMI data released in Asia shows that manufacturing activity in China, Japan, and South Korea remains weak, suppressing the outlook for metal demand. Recently, there have been frequent positive policies in China, but the bullish sentiment has basically materialized, making it difficult for market confidence to further rebound before more positive policies are announced.

Supply side: The mining side maintains abundant resources. In July, 7 refineries had maintenance plans, with a total impact of about 60000 tons. It is expected that the domestic electrolytic copper production in July will be 902100 tons, a decrease of 15800 tons compared to the previous month. In August, there is only one refinery undergoing maintenance, and the domestic supply of electrolytic copper will increase month on month. Recently, there has not been much inflow of imported resources, but overall, the long-term resources of Lomo and Russian copper will supplement domestic spot goods.

On the demand side: In the traditional off-season of consumption, although the terminal demand is not strong, it still has resilience. Last week, the operating rate of refined copper rods was 59.73%, a decrease of 10.14 percentage points compared to the previous week; The operating rate of recycled copper rods was 40.20%, with a decrease of 2.93 percentage points on a weekly basis. From a terminal perspective, the new field of wind and solar energy is improving, real estate completion and peak season air conditioning demand are resilient, while other traditional demand margins are weakening.

In summary, there are not many short-term smelter shipments and imported goods resources in China, with tight supply and demand balance, low inventory, and downstream bargain hunting. It is expected that copper prices will continue to maintain an overall volatile trend.