SHANGHAI, Apr. 16 (SMM) – 52% of Chinese copper tube/pipe producers expected copper prices to hold steady for the foreseeable future, according an SMM survey of 21 enterprises.
The arrival of high demand season and falling SHFE copper stocks would limit any downward room for price declines. However, Chinese government was unlikely to introduce massive stimulus for the near term, leaving little chance of explosive growth in copper consumption. This might create a modest surplus in copper markets, depriving prices of any impetus to rise. Moreover, the growing bonded copper stocks remained a major concern in copper market.
33% of these producers were bearish, arguing that prices proved weak when continuous rises in spot premiums failed to drive a price rally. Besides, the large amounts of short positions for SHFE copper also placed downward pressure on prices.
5% of respondents foresaw a rebound in copper prices this month, citing falling copper stocks reported by both SHFE and LME, as well as upbeat data from the US and Europe. These producers also expected a bottom-out of Chinese economic data in the second quarter. In China’s scrap copper markets, cargo holders mostly showed low selling interest, exacerbating scrap shortages, which would buoy refined copper consumption.
The remaining 10% saw no clear direction for copper prices.