Metals News
30% of Chinese Copper Tube/Pipe Producers Bullish toward Copper Prices
industry news
17:25PM
Source:SMM

SHANGHAI, Mar. 23 (SMM) – 30% Chinese copper tube/pipe producers see copper price rising in the near term, SMM's most recent survey of 20 producers indicates.

China is expected to enhance macroeconomic control, and the PBOC is also expected to lower deposit reserve ratio further, pushing up A-share market. The boom season, combined with the approval of a series of infrastructure construction projects, should boost domestic demand and push up copper prices. In addition, a large numbers of smelters will conduct maintenance soon, with nearly 70,000 tonnes of copper output expected to be affected during March and June. This will allow smelters to hold prices firm.

10% are bearish. The US dollar index stayed high despite a brief fallback last week, and crude oil prices remained low. This should weigh on copper prices. Besides, copper inventories registered on the SHFE soared two weeks ago to 241,616 mt, having risen 136,000 tonnes since the start of the year and almost reaching a record high of 247,591 tonnes hit in March 2013. LME copper stocks also climbed to 342,600 tonnes, their highest since late 2013. Consumption, however, has been weak since the Lantern Festival on March 5. When combined with increasing shorting, copper prices will be dampened.

5% are neutral. Major macroeconomic indicators released recently were mixed. Despite upbeat employment data in the US, the country’s consumption remains lackluster. The US dollar index volatility was up following the Fed’s March policy meeting. These factors will compound to constrain copper price range. Net shorts on COMEX copper decreased to 21,528 lots in the week ending March 10. Net longs on LME copper, however, fell to 16,414 lots in the week ending March 6. Total positions on LME copper reached 360,000.

The remaining 55% are uncertain toward copper prices.  


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