Gold Nine Silver Ten Consumption Season Copper prices may be dominated by strong shocks

Copper prices in September were mainly under pressure due to macroeconomic pressure and trade frictions, but supply continued to be tight, resulting in a dilemma
for copper prices.

On the supply side: during 2018-2019, domestic copper enterprises added nearly 2.
47 million tons of new production capacity, and put into production exceeded expectations, which made the supply pressure in the copper market recover; However, 2019 coincides with the year of overhaul of copper enterprises, so the output of copper enterprises in the first half of this year is significantly lower than expected
.
From January to July 2019, domestic refined copper production accumulated 5.
713 million tons, down 2.
3% year-on-year, and production showed a downward trend, and copper production began to slowly recover
since June.

Demand: Power grid investment performed poorly in the first half of the year, but improved significantly in July, with the cumulative year-on-year growth rate rising from 19.
3% in June to 13.
9%
in July.
In the second half of the year, the power generation potential is large, and it is expected that the scale of grid investment in the fourth quarter is expected to increase
.
In August, the cumulative investment in real estate development fell from 10.
6% to 10.
5% compared with the previous value, and the growth rate of real estate investment fell
for four consecutive months.
However, the growth rate of housing completion area rose from -11.
3% in July to -10%, and the decline narrowed
.
Monthly sales of air conditioners in August were 10.
274 million units, a year-on-year increase of 3.
5%, of which domestic shipments were 7.
291 million units, a year-on-year increase of 0.
6%.

From January to August, China's automobile production and sales reached 15.
939 million units and 16.
104 million units, respectively, down 12.
1% y/y and 11% y/y, down 1.
4 percentage points and 0.
4 percentage points from January to July, respectively, and the overall sharp decline in industry production and sales has improved
.

The outlook for the future market, in summary, copper has been in a narrow range since September, on the one hand, supported by the reduction of copper production, on the other hand, consumption can not be effectively boosted, but overall, gold nine silver ten is the peak consumption season, demand may rebound slightly, it is expected that copper prices will be strong volatility
.