SHANGHAI, Feb 22 (SMM)—Copper prices have surged recently, posting an eight-day winning streak. The most-traded SHFE 2104 copper contract rose by the daily trading limit to 67,370 yuan/mt on Monday February 22, and this was 18.5% higher than the lowest price on February 3.
SMM interviewed Xu Maili, deputy director of the Everbright Futures Research Institute, about his views on this surge in copper prices.
He thought that the rapid rise in copper prices has broken away from short-term fundamental support as currently supply from copper smelters was stable while demand did not improve out of expectations.
In terms of macroeconomic environment, a resurgence of COVID-19 cases was curbed in China, and this, combined with easing global liquidity and economic stimulus packages lifted risk appetite.
Copper prices are likely to rise further in the near term, but in the long run prices and fundamentals will return to consistency.