SHANGHAI, Feb. 28 (SMM) –SMM's latest survey of 20 major domestic electric wire and cable producers confirms different views towards future copper price trends.

Based on the survey, 32% of these surveyed producers believe copper prices will continue to fluctuate over the near term. As the traditional high demand period for copper hasn't come yet, and as present copper inventories are high, copper prices are unlikely to trend higher. As copper consumption improves during March, copper prices will rise and entice a large number of investors to buy, which, though, will make the upside room limited. Hence, SHFE copper prices will fluctuate between RMB 58,000-62,000/mt for the foreseeable future.

21% of producers are optimistic over future copper prices. China's central bank has cut the reserve requirement ratio for the first time this year, and local governments also have signs to relax policy for the housing markets, meaning the government has shifted their focus to ensuring economic growth from fighting inflation last year. Furthermore, crude oil prices have been rising due to political factors, and investors may favor risk assets such as copper. Therefore, SHFE copper prices will likely surge to RMB 65,000/mt.

16% of these producers expect SHFE copper prices to fall to RMB 56,000/mt. SHFE copper prices have risen to RMB 60,000/mt several times recently, discounts on spot copper remain large. Wait-and-see sentiment downstream is growing as spot copper prices near the RMB 60,000/mt mark. Given market surplus, SHFE copper prices cannot stabilize at RMB 60,000/mt and will probably retreat to RMB 56,000/mt.

The remaining 31% of producers have no idea about where copper market is headed.