Crude Oil Demand Expected to Be Strong; Copper Prices Continued to Rise Overnight [SMM Morning Comment on Copper]

SMM, January 10: Overnight, LME copper opened at $9,084.5/mt, initially declined to a low of $9,056.5/mt, fluctuated widely during the session, and fluctuated upward towards the close, reaching a high of $9,114/mt before settling at $9,111.5/mt, up 0.67%. Trading volume reached 18,000 lots, and open interest stood at 261,000 lots. Overnight, the most-traded SHFE copper 2502 contract opened at 75,020 yuan/mt, hit a high of 75,250 yuan/mt at the start, then declined to a low of 74,990 yuan/mt, fluctuated rangebound thereafter, and finally closed at 75,120 yuan/mt, up 0.58%. Trading volume reached 19,000 lots, and open interest stood at 140,000 lots. Macro side, colder weather in parts of the US and Europe boosted winter fuel demand, leading to strong global crude oil demand, which supported copper prices. Additionally, several US Fed officials confirmed on Thursday that the Fed might keep interest rates at current levels for an extended period, with further interest rate cuts only likely if inflation cools significantly. Focus today is on the non-farm payrolls data, as the December report is expected to provide clearer insights into the current dynamics of the US labour market. Fundamentally, market liquidity remains tight, with suppliers showing a clear tendency to hold back cargoes. As of Thursday, January 9, SMM data showed that copper inventories in major regions across China decreased by 10,100 mt from Monday to 105,700 mt, ending a two-week increase and resuming a decline. Compared to Monday, inventories in most regions nationwide saw reductions. Looking ahead to next week, total supply is expected to increase. However, with the Chinese New Year holiday approaching, downstream consumption may decline, and weekly inventories may rise again. In terms of prices, copper prices are expected to face limited upward space today, with more attention on the US non-farm payrolls data.