1、 Trend analysis

Copper prices fluctuated and rose in August. At the beginning of the month, the copper price was 106055 yuan/ton, and at the end of the month, the copper price rose to 109423.33 yuan/ton, with an overall increase of 3.18% and a year-on-year increase of 39.13%.
The copper spot price in August was higher than the main contract price, indicating strong support for copper prices in the future.
According to LME inventory, LME copper inventory first fell and then rose in August. As of the end of the month, LME copper inventory was 234275 tons, a decrease of 1.71% from the beginning of the month.
Macroscopically, the macroeconomic data of the United States in August continued the stagflation background of “slowing growth and stubborn inflation”. The final value of GDP in the second quarter confirmed a quarterly growth of 1.48%, which continued to slow down from 2.1% in the first quarter; The core PCE recorded 3.3% year-on-year in July, still far from the target of 2%. Federal Reserve’s Walsh delivered a hawkish speech at the Jackson Hole Global Central Bank Annual Meeting, clearly prioritizing price stability in policy. CME data shows that the probability of market expectations for a rate hike in September has risen from 35% to around 60%. Domestically, the manufacturing PMI for August was 49.8%, up 0.6 percentage points from the previous month, with both production and demand expanding simultaneously. Geographically, the US Iran conflict has been recurring, the issue of navigation in the Strait of Hormuz remains unresolved, and the situation in the Middle East has caused intermittent disruptions to market sentiment.
Supply side: The continuous tight supply from the mining side is the core contradiction of the copper market in August. The International Copper Research Group (ICSG) has lowered its forecast for global copper production growth in 2026 from 2.3% to 1.6%. Chile’s copper production in July decreased by 9.4% year-on-year, and mainstream mining companies such as Antofagasta have lowered their annual production guidelines. The processing fee for copper concentrate has accelerated its decline, and as of the week ending August 28th, the imported copper concentrate index has fallen to -1998.84 US dollars per dry ton, reaching an extremely low historical value. In terms of refined copper production, the estimated production of electrolytic copper in August was 1.1392 million tons, an increase of 1.1% compared to the previous month, but a decrease of 2.76% year-on-year, reflecting that the shortage of copper concentrate has formed a substantial constraint on production. In terms of recycled copper, Europe and the United States are promoting the return of manufacturing industries and tightening the supply of overseas scrap copper, while the supply of domestically traded scrap copper is substantially tightened.
Downstream: August is in the traditional off-season for consumption, and overall terminal demand is weak. High copper prices have significantly suppressed downstream procurement, and companies are cautious in their willingness to stock up at high prices and hold onto essential procurement in multiple dimensions. In terms of the operating rate of refined copper rods, as of August 20th, it was 61.2%, which has rebounded but is still at a relatively low level; Terminals such as cables and enameled wires are suppressed by high copper prices, resulting in weak overall demand. In terms of structural highlights, emerging fields such as AI computing power and new energy require resilience; The demand in the copper foil field has significantly rebounded, and AI servers have driven rapid growth in demand for high-end HVLP copper foil. The real estate market remains weak, automobile production and sales have declined, demand in the air conditioning industry has weakened, and traditional terminal demand lacks incremental support.

influencing factors
Entering September, core variables will be concentrated: the Federal Reserve’s September 17 interest rate meeting will set short-term financial conditions, and if interest rate hikes exceed expectations, it will suppress risk appetite; Will the 232 tariffs imposed by the United States on Chinese copper materials be officially implemented at the end of September, reshaping global trade flows; The accelerated issuance of domestic special bonds is directly linked to the quality of “Golden September and Silver October” consumption. In addition, the TC of copper concentrate has fallen to around -200 US dollars, and we need to be vigilant about the expansion of unplanned production cuts by Chinese smelters; The concentration of LME registered warehouse receipts is relatively high, and the risk of warehouse crowding has not yet been eliminated.
In summary, copper prices fluctuated strongly in August due to the shortage of mining resources and low inventory support, but off-season consumption and expectations of interest rate hikes limited the upper space. Looking ahead to September, the marginal rebound in peak season demand and policy expectations provide bottom support, but the uncertainty of the Federal Reserve’s interest rate hike, the pace of US tariff implementation, and geopolitical risks will increase the volatility. If the macro bearish sentiment is realized, copper prices may first suppress and then rise; If the fundamental squeeze returns, it is expected to reach a new high. Overall, maintaining a high and wide range of volatility judgment, the tight supply pattern is still the core safety cushion for bulls.

The PTA market in August showed an overall upward trend, with a price of 5945 yuan/ton at the beginning of the month in East China, up 6.02% from 6303 yuan/ton at the end of the month. In August, the domestic PTA market experienced a structural upward trend, driven by a significant contraction in the supply side and cost support from geopolitical disturbances in crude oil. However, overall terminal demand was weak, indicating a typical supply driven market rather than a significant rebound in terminal consumption.

The overall market shows obvious stage differentiation. In early August, the PTA market experienced a narrow range of fluctuations, with downstream textile terminal orders continuing to be weak in the off-season. The overall market demand was insufficient, and polyester factories mainly replenished their inventory for essential needs, lacking centralized replenishment actions. Market trading sentiment was flat, and price fluctuations were limited. In mid August, the market logic completely reversed, and multiple large-scale PTA main units in China entered a centralized maintenance cycle. The industry’s operating rate quickly fell to a low of around 63% for the year. The supply of goods in the spot market has significantly tightened, enterprise inventories continue to deplete, and social inventories have fallen to low levels, highlighting the tight spot market pattern. At the same time, international crude oil is subject to strong fluctuations due to the geopolitical situation, and upstream PX raw material prices are rising synchronously. Under the dual positive resonance, PTA prices have entered a significant upward trend, with significant monthly increases.
Looking ahead to the future, the long short game in the PTA market will intensify in September, and the market may shift from a unilateral rise to a high-level oscillation. The pressure on the supply side is gradually becoming apparent. From the end of August to early September, multiple sets of main equipment that had undergone early maintenance were restarted and put into operation, and the industry’s operating rate quickly rebounded. The tight spot market pattern that had lasted for nearly a month is gradually easing, and the increase in market supply will directly suppress the further upward space of PTA prices.
The marginal weakening of cost side support has led to significant fluctuations in international crude oil prices due to geopolitical disturbances, resulting in high market uncertainty. At the same time, PX maintenance facilities are gradually resuming production, and the supply and demand of raw materials are becoming more relaxed, weakening the cost support for PTA. Subsequently, prices will follow more fluctuations in the crude oil pulse market.
The demand side remains the core variable of the market, and the market has officially entered the traditional “golden nine” consumption peak season, but there is significant uncertainty in the recovery of terminal textile orders. In addition, the profits of the polyester industry are squeezed by MEG prices, putting pressure on the production profits of enterprises, and there is a risk of a decline in the subsequent polyester operating rate.