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Trade Service
First, the macro aspect
First, the macro aspectDomestically, on the 14th, it was announced that the growth rate of fixed investment from January to August was not as expected, a record low for six consecutive months, infrastructure is still a serious drag, and the overall economy is still facing downward pressure, but with the recent introduction of relevant national policies, domestic consumption is expected to be improved, specifically implemented, on the 26th, the CPC Central Committee and the State Council issued the "Rural Revitalization Strategic Plan (2018-2022)" intended to promote rural construction, while domestic large-scale infrastructure projects are also expected to be launched
one after another.
On the 18th, the United States decided to impose a 10% tariff on $200 billion of Chinese products exported to the United States, which involved six major categories of commodities such as mechanical and electrical, light industry, textile and garment, resources and chemicals, agricultural products, and medicines, and officially landed on the 24th; China immediately countered by imposing 5-10% tariffs
on $60 billion of US goods.
The tariffs were less than the 25% market expected, so copper prices rose
sharply after the shortfall was exhausted.
As far as the follow-up trend of the trade war is concerned, our side rejected the invitation for consultation proposed by the US Treasury Secretary on the 12th, hoping that the two sides can conduct effective negotiations under the premise of fairness and justice, and the overall improvement
has not been obvious.
International aspect,
The Argentine government announced a fiscal reform plan on September 3 that will tax commodity exporters to boost revenues, and the government system faces major layoffs and a year ahead of schedule
.
The peso fell more than 4 percent against the dollar to below 38 pesos, while the country's main Merval stock index fell 2 percent
.
Showing that the emerging market crisis is still ongoing, and at the end of the month, the Argentine government and the IMF finalized a new loan agreement, according to which the IMF increased its financing loan to Afghanistan by $7.
1 billion over three years.
The new agreement excludes the inflation target, and the crisis is expected to ease temporarily, but there is still a large uncertainty overall, which has a deep
impact on the dollar.
In the early morning of the 27th, the Federal Reserve announced that the federal funds rate was revised up within the target range of 2%-2.
25%, and the third interest rate hike this year landed, and from Chairman Powell's subsequent press conference remarks, it can be concluded that the US unemployment rate is low, the economy is still strong, and will maintain its hawkish interest rate hike strategy
.
According to CME "Fed Watch", the probability of raising interest rates by 25 basis points to the range of 2.
25%-2.
5% in December this year is 78.
5%, and the dollar may gradually recover
after a period of weakening.
Second, the market review
Second, the market review
In early September, copper prices were still bearish in the macro, mainly because the $200 billion tariff in the US pair has not yet landed
.
However, after the continuous decline in the early stage, the strength of copper short selling has not been as strong as before
.
In the absence of deterioration in fundamentals, the technical picture also bottomed out for the second time, and the 47,000 support was effective
.
Subsequently, copper prices attracted a wave of rebound, especially after the official landing of tariffs in late September, after the bearish news came out, copper prices rebounded sharply, breaking through 49,000 and 50,000 support levels
.
It came to around 51,000, and the continuous rise led to some profit-taking orders, and copper prices fell back to a high around 50,000
.
.
However, after the continuous decline in the early stage, the strength of copper short selling has not been as strong as before
.
In the absence of deterioration in fundamentals, the technical picture also bottomed out for the second time, and the 47,000 support was effective
.
Subsequently, copper prices attracted a wave of rebound, especially after the official landing of tariffs in late September, after the bearish news came out, copper prices rebounded sharply, breaking through 49,000 and 50,000 support levels
.
It came to around 51,000, and the continuous rise led to some profit-taking orders, and copper prices fell back to a high around 50,000
.
With the approach of the National Day holiday, the procurement efforts of downstream manufacturers began to weaken
.
And the premium is no longer strong, and the amplitude is declining
.
From the height of more than 300 after the change of month, to the current around 40 yuan, the merchants no longer hold the price, and the willingness to exchange cash before the holiday is strong
.
The window for import profitability, which lasted for more than two weeks, closed again on the 25th, and the market began to decrease
.
3.
Waste market
Waste market
In September, the overall copper price maintained a volatile upward trend, the main operating range was 48,000-50,000 yuan / ton, and the scrap copper rose from 43,500 yuan / ton to 45,000 yuan / ton, an increase of more than 1,500, so the refined scrap price spread also widened again after the middle of this month, and the market demand for scrap copper was rekindled, boosting the price
of scrap copper.
As the early copper price is at a low level, resulting in the long-term suppression of loss-making inventory in the hands of holders, with the strong return of copper prices, coupled with the approach to the National Day holiday, the market risk aversion heats up, holders choose to increase shipments to reduce risks, and the market supply has also changed from shortage to short-term abundance
.
Due to the introduction of the state to increase infrastructure investment policies, stimulate downstream consumption, thereby promoting downstream copper manufacturers to demand for copper scrap has also increased significantly, but also for the post-holiday copper price trend with a bullish mentality, actively enter the market procurement, market supply and demand side improvement, scrap copper overall market atmosphere improved, trading picked up
.
4.
Trend forecast
Trend forecast
On the occasion of the golden nine silver ten, the golden nine has been cashed, and the October market is not expected to be too bad
.
With the official landing of the 200 billion tariff on the 24th, most of the bearish so far has been effectively released, the trade war does not escalate further, and copper prices are expected to continue to recover
.
From a technical point of view, the center of gravity of copper prices has moved up, and has got rid of the bottom space, but after the sharp rise, there is a situation of profit funds, so the short-term may fall back and gain momentum, and the medium-term trend is still more expected
.
5.
Industry news
Industry news
1.
News on the 13th, Francisco Carvajal, vice president of operations of Chile's Collahuasi copper mine, said that this year's Collahuasi copper ore produced 545,000 tons of copper, an increase of 4%
over 2017.
Located in northern Chile and controlled by Anglo American Plc and Glencore Plc, Collahuasi is one of
the world's largest copper mines.
2.
Peru announced the launch of a new copper mine project, the second major mining investment
in 6 weeks.
The US$1.
6 billion Mina Justa project in Ica, located on the southern coast, will produce 102,000 mt/year of copper concentrate starting in 2020
.
3.
A company owned by Russian billionaire Alisher Usmanov Holdings said it had begun building a large mining and metallurgical plant
at the Udokan copper mine in a remote region of eastern Siberia.
Udokan is the largest undeveloped copper mine in Russia and one of the
largest in the world.
With total reserves of about 26.
7 million tons, the Udokan copper mine is the largest undeveloped copper mine in Russia and one of the
largest in the world.
4.
Global mining giant BHP Billiton said it would buy a 6.
1% stake
in SolGold for US$35.
2 million.
SolGold PLC is the majority shareholder and operator
of the Cascabel copper mine project in Ecuador.
BHP CEO Andrew Mackenzie said the investment would give the company exposure to a high-quality copper exploration project in Ecuador, which is a "very promising" project
for the company.
5.
On September 21, China copper option contracts were officially listed and traded
on the Shanghai Futures Exchange.
This is the first industrial option variety in China and the third option
variety in the domestic futures market.
In March and April last year, soybean meal options and sugar options were listed on
the Dalian Commodity Exchange and the Zhengzhou Commodity Exchange respectively.
According to the explanation in the previous issue, the reason why copper was chosen as the first option variety is because its corresponding copper futures are the most mature futures varieties
in China.
6.
Chile's lower house has begun working on a proposal to impose a 3% mining royalty on copper and lithium miners operating in the country at nominal value, which applies to miners
with an annual output of more than 12,000 tons of copper and 50,000 tons of lithium.
The draft says miners should pay taxes annually, or from the date of mining if mines have not yet commenced operations
.
