Analysis of copper price trend in Yangtze River spot market (3.5-3.9)

Macro: Domestically, the trend of domestic copper prices this week is weaker than that of the external market, and the overall decline is obvious
.
This week, China released a series of important economic data such as import and export, CPI and PPI, except for the excellent report card of export data, other data were less than expected, casting a shadow
over the economic performance in the first quarter of 2018.
In the second half of this week, under the influence of US tariffs and the premise that most of China's recent economic data was less than expected, copper prices continued to close down, and the overall performance was significantly less than expected
.
Abroad, this week's external trading trend fell sharply from last week, which surprised the market a little
.
US President Trump announced that the United States will impose tariffs on imported steel and aluminum products, Canada and Mexico were temporarily exempted, a stone stirred up a thousand waves, the tariff was strongly opposed by many countries including China, market investors are generally worried that the trade war will affect the global macroeconomic stability, the metal market is dragged down across the board, the overall bearish sentiment of the market is strong
.

Market: With the departure of the Lantern Festival, most domestic merchants have returned to the market this week, and the market transaction situation has gradually warmed up
.
However, as far as the form of this week is concerned, downstream demand has not met previous market expectations, and most copper-using manufacturers have maintained on-demand purchases during the week, and few have actively stocked up
.
According to the reaction of some merchants, on the one hand, their own high-priced inventory years ago has not been fully digested, on the other hand, it is also affected by the weak market of copper prices, worried that copper prices continue to fall sharply, and dare not purchase a large amount
.
On the whole, the pessimism of downstream merchants is relatively strong, which is not conducive to further improvement
of market demand in the short term.
In the recycled copper market, due to the continuous high pressure of environmental protection policies, due to holding losses and difficulties in replenishment, recycled copper holders are currently reluctant to sell and continue to maintain a large premium quotation
.

In terms of inventories: London copper stocks continued to decline this week, with a cumulative weekly reduction of 13,775 metric tons to 311125 metric tons, a cumulative decline of about 4.
24%, hitting a more than four-week low
.
Shanghai copper inventories rose by 7,808 tonnes to 268095 tonnes this week, an increase of about 3 percent and an 11-month high
.
From this week's inventory data, Shanghai Stock Exchange bonded warehouse copper inventory this Friday increased by 7808 tons to 268095 tons, the Spring Festival holiday inventory accumulation in line with market expectations, the short-term copper price formed a certain suppression, London inventory decreased by 13775 tons to 311125 tons, inventory continued to exceed 300,000 tons, from the above inventory data, this week the overall performance of the supply of the two cities imported copper continued to flow into the domestic market, most of the holders of the overall shipment positive, most choose to adjust the price shipment, Some downstream manufacturers have sufficient stocks before the holiday and there is no obvious purchase, the overall total transaction volume is limited, and in the later period, due to the sharp decline in copper prices, holders choose to sell at a high price, and the overall transaction continues to be light
.

Future market analysis: At present, it is at the beginning of the consumption season, and the introduction of US tariffs has a great weakening effect on China's consumer demand, the largest consumer of copper, and terminal applications such as electricity, air conditioning, etc.
may have a certain slowdown, or shorten the peak season, which significantly suppresses
copper prices.
Overall, driven by the lack of favorable factors, the recent weak trend of copper prices has seriously affected the optimism of the market, if the future copper price is difficult to stabilize and rise, the market transaction will inevitably remain at a poor level, which in turn will drag down copper prices, so the future market needs to pay more attention to the change
of news.