The Shanghai Futures Exchange's (SHFE) warehouse warrants for copper futures fell by 7,296 tonnes day on day to 121,826 tonnes on March 10, leading to a week-on-week decrease of 18,731 tonnes or 13.33%, and an increase of 9,389 tonnes or 8.35% month on month.
SHFE copper price fell to about Yuan 68,800/tonne today, while premiums of refined copper in China's main markets rose by Yuan 10-40/tonne day on day. According to US government data, 211,000 people applied for unemployment benefits for the first time last week, far exceeding the 190,000 in the previous week and the 195,000 expected. The cooling in the labor market will slightly ease the market's expectation of the Fed's interest rate increase. However, the probability of raising interest rates by 50 basis points in March is still as high as 64.6%, due to the frequent hawkish remarks made by Federal Reserve Chairman Powell recently, which also led to the decline of copper prices today.
According to Mysteel's data, refined copper social inventory fell by 28,600 tonnes week on week to 285,600 tonnes this week and bonded inventory slightly rose by 3,000 tonnes week on week to 187,800 tonnes. The import loss narrowed to Yuan 375/tonne today and copper import is expected to increase in March with the coming of the consumption peak season.
China will release economic data for January to February next week. Before that, copper prices are expected to fluctuate in the current range as inflation data weigh on copper prices while demand recovery in China supports prices.
Data Source: SHFE
Data Source: SHFE
Written by Edenlis Huang, huangting@mysteel.com
Edited by Ting Ao, aoting@mysteel.com