Minutes of 5.20 Bronze Morning meeting

Macro aspect: 1) the US Congressional Budget Office raised its GDP forecast for 2021, but remained pessimistic about the outlook for the job market. The latest forecast shows that the unemployment rate will average 11.5% this year and drop slightly to 9.3% in 2021. 2) according to medical industry media Stat, Moderna withheld key information about the new crown vaccine. According to Kyodo news agency, the drug Avigan did not show a significant effect in the treatment of XCRV. [bearish] 3) the number of new crown cases and deaths reported in Brazil reached a record high in a single day. [bearish] fundamentals: 1) the price difference of scrap copper was 968 yuan / ton yesterday. The month-on-month expansion was 269 yuan. (calculated at 5.9% of the vote point) the price of copper has risen sharply today, which is good for traders to take advantage of the high exchange of cash, and the circulation of goods has increased. The solid waste Center announced the seventh batch of applications for import restrictions in 2020. A total of 14 copper-related enterprises were approved this time, with a total import volume of 10423 tons, with a total of 540200 tons in the first seven batches, which can meet market demand at least before July. Therefore, it is expected that the current approval volume is still sufficient. [bearish] 2) the import profit of imported copper was around 150 yuan / ton yesterday. Today's market activity is significantly weaker than yesterday, turnover is light. The price offered by the consignor for the bill of lading arriving in Hong Kong at the end of May and early June remained high, and the limited supply of goods was quickly digested. As for the bill of lading arriving in Hong Kong, the seller is reluctant to lower the price because it is expected to open the price in July after the change of month; the buyer is expected to have room for price reduction, the buying and selling order price is difficult to match, and the transaction is in a stalemate. There is almost no warehouse receipt offer. On the whole, there are relatively few quotations and enquiries in the foreign trade market today, and the market performance is at a high level. 3) inventory May 19th LME copper inventory reduced 2150 tons to 274225 tons; last period copper warehouse receipt inventory reduced 1284 tons to 68589 tons [neutral] 4) spot East China: it rose yesterday, low water supply in the morning market attracted the influx of trade buyers, the intention of the holder to push up the water again is not enough, but traders follow up to show a stop, rising water and then pushing the pace will slow down. It is expected that the spot water will rise to 180,000,000 yuan / ton today. South China: yesterday, the spot price of electrolytic copper in Guangdong Province rose by 200,220 to the contract for that month. In the spot market, inventories in Guangdong fell again today after a brief increase, coupled with the continued rise in Shengshui in Shanghai, which made the shippers generally bid up, and the rising water showed a volatile and higher trend within the day. However, high rising water and high absolute consideration limit the activity of market trading, today's downstream is mainly in need of procurement, do not want to replenish more. Copper price and forecast: last night, Lun Copper closed at 5353 US dollars / ton, up 0.14%. The trading volume was 14000 lots, and its position decreased by 2022 lots to 274000 lots. The Shanghai Copper 2007 contract closed at 43690 yuan / ton, up 1.18%, with a turnover of 93000 lots, and its position increased by 3141 lots to 106000 lots. At present, the macro-positive effect on copper prices tends to be short-term, so it is difficult to continue to push up copper prices for the following reasons: 1. According to information disclosed by Modena, the final phase of clinical trials of the vaccine will begin in July at the earliest and will be put into use by the end of the year. However, this clinical trial is in the early stage, the application prospect is still uncertain, and the cycle is long, so it is difficult to dispel the market's worry about the second wave of the epidemic. 2. After the weakening of supply logic, the focus is on the sustainability of domestic consumption on the demand side and the process of overseas economic restart. Before there is a clear signal, the market is divided on the direction of copper prices, and it is difficult to change the short-term consolidation situation. As a result, copper prices are expected to maintain a volatile market. The date is now rising, the supply of low rising water in the morning market attracts the influx of trade buyers, and it is not enough for the holders to push up the water again, but the traders will stop to follow up, and the pace of the rising water will slow down. It is expected that the rising water will remain firm before the delivery of the long order. It is estimated that Lun Copper will be 5320m2 / ton today, while Shanghai Copper will be 43800 RMB / ton.