Spot premiums fell at high levels limiting copper price gains

In terms of spot, on December 27, CCMN Yangtze River spot 1# copper trading price was 66550-66590 yuan / ton, the average price was 66570 yuan, up 120 yuan / ton; The premium was reported at 110-150 yuan / ton, with an average price of 130 yuan, down 380 yuan / ton
.
In the spot market, the trading atmosphere is cold, the holders are eager to exchange funds for cash at the end of the year, most downstream enterprises have taken a holiday in advance, demand is weak, and the overall transaction is not good
.

On the supply side, the recent frequent disruptions to copper mines in South America, which are likely to extend into 2023, also sounded the alarm
for next year's supply.
At present, the maintenance of domestic smelters has not been completed, coupled with the decline in inter-provincial transportation efficiency, inventory transportation is blocked, and the lack of manpower at the end of the year affects production, and the supply increase will be less than expected
.

On the demand side, the overall domestic consumption is obviously characterized by the off-season, superimposed on factors such as the approaching holiday, some factories have an early holiday, downstream demand has shrunk, and the market has become more cautious, resulting in a decline
in spot premium.

In summary, the US dollar is weak, market risk appetite is rising, the domestic macro environment is favorable to prices, the stock market and most commodities have shown an upward revision trend, and Shanghai copper is strongly volatile
.
China continues to introduce a series of policies, not only to give policy support to the real estate industry, but also China has decided to take an important step from the comprehensive easing of border restrictions from the epidemic, which has greatly boosted the sustainable development of
the market economy.
However, the driving force of copper fundamentals is not strong, demand remains weak, under the pressure of the epidemic and traditional consumption off-season, subsequent copper consumption will continue to weaken, but at the same time, it also affects the supply level
.
Coupled with the increase in disturbances at overseas mines, the low inventory pattern still supports
copper prices.

Overall, the macro atmosphere is warm, boosting the rise of non-ferrous metals across the board, but the copper market has a state of weak supply and demand, and the spot premium has fallen at a high level, which has involved the rise in copper prices
.