1. Trend Analysis
| Gamma-PGA (gamma polyglutamic acid) |
According to data monitored by Business Society, copper prices fluctuated this week, rising first and then falling. By the 3rd, the price stood at 96,186.67 yuan per ton, up 0.97% from the beginning of the week and 21.6% year-on-year.
According to the weekly price trend chart from Business Society, there have been five increases and seven decreases over the past three months, with copper prices experiencing a slight rise this week.
LME copper inventory
According to data released by the London Metal Exchange (LME), LME copper inventories rose slightly, reaching 364,450 tons by the end of the week, up 0.51% from the start of the week.
On the macro front, the market is gripped by a “defensive” anxiety. Firstly, the strong rebound of the US dollar index. Influenced by delayed expectations of Federal Reserve rate cuts and risk-averse sentiment, the dollar index has climbed back above the 100 mark, suppressing the rebound space for dollar-denominated commodities such as metals. Secondly, Trump’s “Tariff 2.0.” The White House recently announced new tariffs on key industrial sectors, maintaining high 50% tariffs on imports like copper and aluminum.
Supply side: The tight supply situation of copper ore persists. Ivanhoe Mines lowered its production forecast, while domestic copper concentrate spot TC (processing fee) dropped below historical lows, continuing to fluctuate in negative territory, indicating that smelters lose money for every ton of copper produced. CSPT abandoned its guidance price for Q2, further confirming the severe shortage of raw materials. Additionally, stricter inspections on “reverse invoicing” and restricted scrap copper supply forced downstream sectors to shift to refined copper, further intensifying supply pressure.
Demand side: Although traditional infrastructure demand remains weak, AI computing power and new energy are taking over the “baton” of copper consumption. The Ministry of Industry and Information Technology’s “Stable Growth Work Plan for the Nonferrous Metals Industry” has entered a critical phase, with emerging sectors such as data centers and new energy vehicles gradually releasing their copper demand. Data shows that the inflection point for domestic inventory drawdown has emerged. Despite macroeconomic sentiment suppressing pre-holiday stockpiling demand, mandatory restocking continues, and the spot market has not seen panic-driven selling.
In summary, geopolitical uncertainty remains the dominant factor. Until the navigation issue at the Strait of Hormuz is resolved, market risk aversion is unlikely to subside, and copper prices are expected to maintain a wide fluctuation trend. From a medium to long-term perspective, the tight supply-demand balance in the copper market has not changed. The rigid constraints on mine supply and the sustained growth in new energy demand form the core logic behind copper prices being more prone to rising than falling.
Technical Analysis
Through the market analysis system, the future trend of copper prices can be analyzed from two dimensions:
1. When the 10-day moving average (for copper spot prices) is above the 20-day moving average, the probability of an upward trend is higher. Conversely, the probability is lower. Currently, the 10-day moving average for copper prices is below the 20-day moving average, indicating a relatively low probability of an upward trend. However, the 10-day moving average is approaching the 20-day moving average and may cross above it, so it is advisable to closely monitor the potential crossover point.
2. Current Position. Currently, copper prices are at a medium-high level in the short term and medium-low level in the medium term. The positional advantage is not particularly significant.
Overall, copper prices are currently in a weak trend, and the position is not at an absolute low, making a price increase unlikely. Focus on the crossover turning point of moving averages to identify opportunities.
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