“This round of copper price rise has been promoted by the macro side, but also has the strong support of the fundamentals, but from the technical point of view it does rise too fast, that is to say, the adjustment is more reasonable.” The above industry told reporters that in the longer term, whether it is overseas investment banks or research institutions are expected that the shortage of the copper market may last longer, that is to say, after normal adjustment, the center of gravity of copper prices may still rise steadily, unless the fundamentals or the Federal Reserve policy changes beyond expectations.
Zhang Jianhui said that copper prices have encountered some spot selling at the current price, and there is pressure on the shipment of products at a discount. In the future, if copper inventories decline, the Federal Reserve’s new interest rate cut cycle begins, coupled with the continued strength of the domestic economy, copper prices may form a new growth cycle, that is, there is still the possibility of rising to a new high. Of course, on the other hand, if the inventory continues to accumulate in the next step, the copper market will form a downward trend in this price range.
Ji Xianfei also believes that short-term copper prices will be adjusted, but in the medium and long term, it is still dominated by more patterns. He said that at the macro level, the US economy is expected to improve, and the Federal Reserve’s rate cut within the year can still provide liquidity to the market. On the basic level, the tight supply of copper mines may continue to “ferment”, while there is room for improvement on the consumption side, which will drive downstream enterprises to passively buy raw materials on a bargain. In the later stage, we need to focus on the change of spot discount in the process of price adjustment, if the spot discount is narrowed significantly or turned into a premium, the copper price will also be supported.
But other analysts take a more pessimistic view. Wang Yunfei believes that the current round of copper price rise may have ended, and there is no upward driving force in the short term. “Starting from the logic supported by market bulls, the expectation of strong copper demand under the low-carbon economy is still to be fulfilled, and it is also facing the downstream demand contraction caused by high copper prices in the short term, as well as the negative factors such as the reduction of stock demand caused by the downward economic cycle in the medium and long term and the pressure on demand caused by changes in the global trade environment.”
Jiang Lu expects that in the next period of time, copper prices will be mainly restructured by shocks. In the short term, there is pressure on COMEX copper in the next month, domestic supply and demand tighten to achieve destocking, and the price correction slope may slow down. In addition, the fall in copper prices will release downstream point price demand, which will form a certain support for prices. He expects that by the end of June, the copper price reference operating range is 78,000 to 89,000 yuan/ton, the average price of the main contract is expected to be 82,500 yuan/ton, and the downstream can consider replenishment near the average price. In the medium and long term, he believes that the US interest rate cut will be delayed, while the economic downside risk remains, and copper prices will face certain pressure.
Post time: May-30-2024