The Shanghai Futures Exchange's (SHFE) warehouse warrants for copper futures fell by 833 tonnes day on day to 25,349 tonnes on December 26, leading to a week-on-week decrease of 4,871 tonnes or 16.12%, and a decrease of 9,695 tonnes or 27.67% month on month.
LME copper futures inventory fell to 81,475 tonnes as of last Friday, which was at a historically low level, which supported copper prices. The current market sentiment is more sensitive to low inventory and warehouse receipt data, which is likely to lead to substantial fluctuations in copper prices.
However, the expected realization and policy implementation still need to be verified. The risk appetite of market participants will decrease as the New Year Holiday approaches. The demand for copper in China was more restrained than the supply. The continuous weakening of downstream demand in the near future may keep depressing copper prices.
In general, increased uncertainty about macroeconomic situations, and the current weakening of China's copper demand make it difficult for copper prices to further rise. Copper prices are expected to fluctuate in the range of Yuan 64,500-66,500/tonne recently.
Data Source: SHFE
Data Source: SHFE
Written by Edenlis Huang, huangting@mysteel.com
Edited by Ting Ao, aoting@mysteel.com