Copper prices short-term or pullback optimistic about medium and long-term performance

As the domestic new crown pneumonia epidemic is basically under control, real enterprises have resumed work and production, the most difficult time of the real economy has passed, and at the same time stimulated by the expectations of the two sessions, the domestic financial market performance is relatively optimistic, resulting in a continuous rebound
in Shanghai copper prices from April.

Although the current copper price performance is still relatively strong, but the fundamentals have weakened, there is short-term adjustment pressure, because the tight supply speculation has cooled, first of all, refined copper import profit window opened, a large number of imported copper poured into the domestic market
.
Secondly, the new policy of recycled copper imports may be implemented on July 1, and the price spread of refined copper scrap has begun to widen, and the substitution effect of refined copper has weakened
.
In addition, there is a trend
of escalation in the recent friction between the two sides.

Therefore, although copper prices are still showing an upward trend, potential pullback risks have emerged: 1.
Trade frictions between the two sides have escalated, and the RMB has depreciated sharply; 2.
The data and policies announced at the two sessions are not as good as market expectations; 3.
A large number of imported copper has poured into the domestic market, and the new policy of recycled copper import is about to be implemented
.
Therefore, in the short term, the future copper price should not be overly optimistic
.

However, in the medium and long term, copper prices are still optimistic, because economic stimulus will be the main tone
after the epidemic.