Copper came under pressure after the high, and the short-term oscillation market continued

At present, the supply of copper ore is still at the bottom of the expansion cycle, and global copper concentrate production is expected to be about 17.
2 million tons in 2019, an increase of about 2.
3%
year-on-year.
In 2019, the new demand for domestic copper concentrate will be 400,000-500,000 tons, but the growth of copper ore is only 100,000-150,000 tons, and the supply of copper concentrate is tight
.
Domestic copper concentrate production in September 2019 was about 148,100 tons, up 6.
55% month-on-month, and copper concentrate production from January to September was 1,153,100 tons
.
Since most smelters have impulse demand in the second half of the year, the output will be clearly reflected, and most miners have smelter backgrounds, so it is expected that the overall output of domestic copper concentrate will increase
in the second half of the year.

From the perspective of domestic copper supply, copper smelter projects have been launched more intensively in the past two years, and SMM expects that there will still be an annual production capacity of more than 700,000 tons to be put into operation
in 2019.
Refined copper production is expected to be 9.
5 million tons in 2019, with a growth rate of 8.
6%.

Domestic refined copper output in September was 838,000 tons, a year-on-year increase of 11.
6%; Total refined copper output from January to September was 6.
986 million tons, up 6.
4%
year-on-year.
In October, the supply of copper ore raw materials was sufficient, only Tongling Nonferrous Metal and Jiangxi Copper overhauled the crude refining link, and the refining output was not affected, and it is expected that the refined copper output in October may not decline
month-on-month.
Due to the trend of copper companies catching up with indicators in the fourth quarter, it is expected that the supply of refined copper will increase
.

From the perspective of the operation of the domestic automotive industry, the production and sales data in September rebounded from August, and the year-on-year decline in industry sales was narrower than in August, but the decline was still large
.
September production and sales were 2.
209 million units, up 11% y/y, 16% y/y, and down 6.
2% y/y, and 5.
2%
y/y, respectively.
While the impact of consumption overdraft brought about by the national fifth to sixth is almost digested, nearly half of the domestic restricted purchase cities around June and September have successively relaxed relevant restrictions, bringing an increase
.
However, the current lack of overall consumer demand has made the recovery of the automotive industry slower
.
Affected by the low base effect in the same period last year, it is expected that the short-term decline in domestic automobile sales will continue to narrow, but the time for the market reversal still needs to be
patient.

At the same time, China's new energy vehicle market has not yet come out of the haze, and production and sales have been sluggish
for three months.
NEV production and sales in September were 89,000 units, up 2.
0% m/m and down 6.
5% m/m, and down 29.
9% y/y, down 34.
2%
y/y, respectively.

The slowdown in consumer demand for cars and the increase in sales costs caused by the decline in subsidies have had an impact on production and sales, and the whole industry is facing greater pressure
in the short term.
Following the implementation of the new subsidy policy, the CAAM lowered its forecast for new energy vehicle sales from 1.
6 million units to 1.
5 million units
.
With only 872,000 units sold in September, the new energy vehicle market in the fourth quarter was full of difficulties in achieving its target, and the market urgently needs new policies to open up demand space
.

From January to September 2019, the cumulative value of power grid infrastructure investment completion was 295.
3 billion yuan, a cumulative decrease of 12.
5% year-on-year.

At the same time, the construction of 5G communication networks starting in 2019 will gradually roll out in the next few years, and the demand for copper for communication equipment will be multiplied, and in the long run, the copper demand prospect can remain stable
for a long time.

In summary, from the supply side, the recent global total inventory including bonded zones has continued to decline and is at a low level in the past three years, and interference from the supply side of copper concentrate has occurred frequently, and it is still necessary to pay attention to Chile in the later stage
.
At the same time, although there is more refining capacity, the limited supply of copper concentrate will make the actual supply increment insufficient
.
From the demand side, under the continuous increase of policies, the possibility of domestic economic stabilization has increased, and there are signs of improvement in the main areas of copper use, but it is still not obvious
.
In general, Shanghai copper will be dominated by a wide range of oscillations in the near future, with an operating range of 46550-47550 yuan / ton
.