[SMM analysis] domestic electrolytic copper accumulation rhythm opened ahead of time!

SMM, Oct. 18: as of October 18, the inventory of the last period was reported at 152500 tons, an increase of 35000 tons over 9.27 days before the festival, and the cumulative inventory volume in the same period last year was 28800 tons. This year, the cumulative storage rhythm has arrived ahead of schedule.

On the supply side, domestic output and imports have increased, and the pressure on domestic supply has increased. According to SMM research, China's electrolytic copper output in September was 759300 tons, up 5.93 percent from the same period last year, and the cumulative output from January to September was 6.5574 million tons, up 0.79 percent from the same period last year. Domestic electrolytic copper production increased by nearly 60, 000 tons compared with the same period last year. At the same time, before and after the National Day, the import window of electrolytic copper occasionally opened, traders import actively, after the festival copper imports began to enter the country one after another, it is expected that the amount of arrival in Hong Kong will still increase in the later period.

Consumer side, this year's downstream "gold nine silver 10" consumption is less than expected, according to SMM, in September the average operating rate of copper enterprises for 75.82%, year-on-year decline of 2.56 percentage points, downstream consumption only for marginal improvement, and no peak season market phenomenon, downstream procurement enthusiasm is weak, the overall performance of the state of oversupply, so that the post-festival spot rise discount support is insufficient, the decline is faster.

The production capacity of Guangxi Nanguo, Chifeng Yun Copper and Heilongjiang Zijin Copper Industry continues to release, electrolytic copper gradually flows into the market, the domestic electrolytic copper output increases steadily in the fourth quarter, and the domestic electrolytic copper output is expected to rise to 778300 tons in October, an increase of 2.5% over the previous month. Moreover, imported copper has also arrived in Hong Kong one after another, and the market supply has increased. However, downstream consumption is not warming demand is relatively weak, traders' inventory is also high replenishment willingness is poor, resulting in this year's domestic electrolytic copper accumulation earlier than in previous years and higher than the same level, it is expected that the follow-up domestic electrolytic copper accumulation will continue. However, the spot rise in the short term is still in the long single trading temporarily stabilized.