SHANGHAI, Jun. 24 (SMM) – 43% of Chinese copper plate, sheet, strip and foil producers predict that copper prices will fall for the foreseeable future, due partly to the softening demand in offseason, an SMM survey of 21 enterprises shows.

On the supply side, with most smelters completing maintenance, refined copper output is expected to rise. Besides, as banks cut or suspended metal-based financing, copper stocks now pledged to secure bank loans can no longer be used as collateral after these loans are repaid. These stocks will thus flow into the market, pushing up copper supply.

Furthermore, the diverged trends of copper premiums in Shanghai and Guangdong indicate current high copper premiums are not entirely backed by robust demand. The above factors are leaving these producers bearish towards copper price outlook.

28% of enterprises expect copper prices to hold steady, citing an easing of fears caused by the Qingdao’s scandal.

Copper premiums in China held firm last week and premiums for imported copper also leveled out, while lower selling interest among holders of bonded warehouse warrants may also limit any decline in copper prices.

That said, 5% of producers are still bullish, noting that the strong support at lower price levels and fading influence of Qingdao’s investigation will push copper prices higher.

On the macro front, China’s Premier Li Keqiang reiterated lately that China is expected to maintain a 7.5% GDP growth this year. The modest pro-growth measures introduced by the Chinese government are also delivering results.

Despite a potential downturn in China’s housing market, a few enterprises hold that the ongoing construction of affordable housing will offset any negative impact from falling home prices.

The remaining 24% of producers see no clear direction in the recent copper prices.