April 2020 cable raw materials (copper) monthly report

First, the macro aspect

Domestically,

1.
According to data from the National Bureau of Statistics, China's official manufacturing PMI in April was 50.
8, expected 51, and the previous value was 52; Non-manufacturing PMI 53.
2 vs 52.
5 expected vs 52.
3
prior.
In April, China's epidemic prevention and control situation was further consolidated, the order of production and life was accelerated, and manufacturing and non-manufacturing production and business activities continued to improve
.

2.
According to data from the National Bureau of Statistics, the GDP in the first quarter of 2020 was 206504 billion yuan, a year-on-year decrease of 6.
8%
at comparable prices.
Under the impact of the epidemic, the overall economic and social situation remained stable, and the overall prevention and control of the epidemic and economic and social development achieved remarkable results, and the decline in major economic indicators in March narrowed significantly
.

3.
According to data from the General Administration of Customs, in the first quarter, China's exports fell by 11.
4% year-on-year, imports fell by 0.
7%, and the trade surplus was 98.
33 billion yuan, a decrease of 80.
6%.

In March, foreign trade imports and exports decreased by only 0.
8% year-on-year, showing a significant recovery
.
In March
, the trade balance turned into a surplus from the deficit of the previous two months.

4.
The Ministry of Industry and Information Technology further relaxes the entry threshold
for new energy vehicle manufacturers and products.
The Ministry of Industry and Information Technology revised the Administrative Provisions on the Access of New Energy Vehicle Manufacturers and Products, deleting the requirements for "design and development capabilities" related to the application for access of new energy vehicle manufacturers, and so on
.

International aspect,

1.
The annualized growth rate of US real GDP in the first quarter of 2020 decreased by 4.
8%, compared to 2.
1%
in the fourth quarter of 2019.
That's the biggest quarterly decline since 2009
.
Economic and social activity in the United States fell sharply in March due to social distancing measures to contain the spread of the epidemic, which had a significant negative impact
on the economy.

2.
The number of initial jobless claims in the United States in the week of April 11 was 5.
245 million, slightly higher than the market expectation of 5 million, and it was also the fourth consecutive week that exceeded one million
.
Cumulatively, the number of initial jobless claims in the past four weeks reached 22.
03 million, basically erasing the new jobs
created since 2010.

3.
The real value of the Eurozone economic sentiment index in April was 67, the forecast value was 74.
7, and the previous value was 94.
2
.
Eurozone sentiment continued to decline in April, posting its biggest monthly decline on record, as pandemic-induced lockdowns brought a lot of economic activity to a standstill
.

4.
At 02:30 a.
m.
Beijing time on April 21, WIT May crude oil futures prices closed negative for the first time, down 305.
97%, and settled at -$37.
63 per barrel, down $
55.
9.
This price has created the lowest point since the launch of WTI Sidtex Light Oil in 1946, and it is also the lowest price
in the history of the oil market.

Second, the market review

This month, Shanghai copper showed a strong rebound trend at the bottom, the intraday volatility of the spot market increased significantly, the overall spot transaction during the bottom period was more positive, and then with the impact of the event within the month declined, of which the month was affected by the OPEC production reduction agreement, short-term commodity market confidence recovery, coupled with the domestic industrial resumption of work momentum is strong, years ago orders rapidly consumed domestic refined copper inventory, Shanghai copper short-term rebound momentum is strong, but on the other hand, although crude oil production has been reduced, but the global epidemic under the poor overseas industrial production, crude oil demand may be reduced by 30% Above, the supply is still greater than the demand in the case of crude oil expansion around the world, bringing copper prices in the month once fell rapidly, which had a certain impact on the short-term copper price rebound, the current copper market is still in the logic of short and long, before and after the May Day holiday need to pay more attention to the overseas crude oil market
.

In terms of the market, the price of refined copper this month has been significantly boosted, and the trading situation of merchants has improved, among which the downstream stocking situation is positive in the case of several sharp rises in copper prices, and the overall premium in the month remains above 100 yuan, of which the monthly average good copper premium is about 146 yuan / ton, the current situation is close to May Day, the trading of merchants has slowed down, and the short-term boost in refined copper demand is reflected in spot trading is more obvious, and the downstream bearish mentality is further reduced
.

In terms of import profit and loss, the import window of refined copper this month has gradually opened, but with the short-term boost of domestic refined copper demand, the import profit window has expanded under the pattern of internal strength and external weakness, and the average monthly import profit and loss is about
140 yuan / ton.

3.
Waste market

This month's copper scrap rose by nearly 4,000 yuan / ton compared with last month, and Foshan Bright Copper today has a price range of 39,500-40,000
yuan / ton.
Affected by the downstream market demand, copper prices rose steadily, and copper scrap broke through the 40,000 mark
.

This month, due to the full resumption of work in March, downstream orders and a series of demand impacts, the price of recycled copper has risen
steadily.
This month, many merchants began to sell their inventory before the year, gradually accepting the loss of the previous year, and cashing out to start this year's trading
.
In order to increase the amount of receipts, profits have been minimized, high-price receipts, downstream enterprises are also maintaining active receipts
.
It is understood that in recent days, downstream manufacturers have shipped a large amount, and the corner waste has also increased correspondingly, and the supply is relatively sufficient, especially in the Kunshan area
.
With the rise of copper prices, the previous market sales and shortage of goods have improved, and the overall market transaction has picked up
.

4.
Trend forecast

This month, Shanghai copper showed a stepwise upward trend, with a monthly upward range of about
4,000 yuan.
At present, the logic still maintains a short and long direction, in which the domestic epidemic in February-March, the overall shift of industrial demand to the release of recent months, the short-term refined copper demand under the high operating rate is strong, and on the other hand, overseas copper mines are seriously disturbed, famous mines have a tendency to reduce production, promoting the short-term Shanghai copper strengthening in terms of supply and demand, but it is worth noting that China's official April PMI manufacturing data has shrunk, exports have been blocked under the influence of the overseas epidemic, and domestic industrial follow-up orders still show signs of reduction.
With industrial demand weaker than production, copper prices are unlikely to rise more sharply annually
.
The recent sharp fluctuations in crude oil prices have affected copper prices, and it is recommended to continue to pay attention to the international epidemic and crude oil trends
.

5.
Industry news

Jiangxi Copper said its refined copper production in 2020 would be 6 percent higher than last year, despite warnings that the spreading coronavirus could hurt demand
.
In addition, the company plans to produce 77 tons of gold, 1,025 tons of silver, 4.
788 million tons of sulfuric acid, 207,500 tons of copper in self-produced copper concentrate, and 1.
63 million tons
of copper rod wire and other copper processing products in 2020.

2
.
Indonesia issued a new batch of 1.
07 million tons of copper concentrate export license to Freeport, which is valid from March 16 this year to March 15, 2021.
Freeport Indonesia is the operator of the world's second largest copper mine
.
In addition, Indonesia issued an export license for 373,626 tonnes of copper concentrate to PT Amman Mineral Nusa Tenggara for one year
.

3.
Zambia plans to revoke the mining license of Glencore's subsidiary, Mopani Copper Mines (MCM), after the company did not notify operations before suspending operations due to the coronavirus pandemic and other issues
.
Mopani previously said in a statement that mining operations were suspended on April 8, but smelters and processing plants will continue to process existing ore from the mine until further notice
.

4.
Minmetals Resources (MMG) withdrew the 2020 Peruvian Las Bambas copper production guidelines, although the current transportation of copper concentrate has been suspended, the Las Bambas copper mine will continue to operate
at low load.
The company's operations in Australia and Congo are normal
.

With the care and maintenance of its CobrePanama mine, First Quantum has lowered its copper guidance for this year by 75,000 tonnes to 75.
5-805,000 tonnes, and gold production is expected to be reduced by 30,000 ounces to 25-270,000 ounces
.
Whether it can reopen before the end of May is still subject to local forecasts
.

6.
Chile's mining minister said that Chile's copper industry is one of the industries least affected by the epidemic in the world, and the country's copper production has only fallen by 1%.

Official statistics from Chile's national copper company, Cochilco, estimate that total production will be reduced by about 63,300 tonnes, or about 1 percent
of the country's annual production.
Chile produced 5.
7 million tonnes of copper
in 2019.