SMM Copper Morning Comment：The Ministry of Finance issues ultra-long-term treasury bonds, copper prices rise overnight

SHANGHAI, May 14 (SMM) - LME copper prices opened at $10118/mt and closed at $10206/mt in last evening trading, a gain of 1.65%, with the low-end of $10091/mt and the high-end of $10206/mt. Trading volume was 22,000 lots, and open interest stood at 341,000 lots. The most active SHFE 2407 copper contract prices opened at 81750 yuan/mt and finished at 82230 yuan/mt overnight, up 1.61%, with the low-end of 81650 yuan/mt and the high-end of 82320 yuan/mt. Trading volume was 38,000 lots and open interest stood at 195,000 lots. On the macro level, the domestic Ministry of Finance issued ultra-long-term government bonds, which provided a positive stimulus to consumption and investment. In addition, buying funds are still pushing up copper prices, and cross-market arbitrage is also promoting the rise of LME copper to a certain extent. In terms of fundamentals, from the supply side, domestic refineries have entered maintenance, and domestic copper supply has declined on a month-on-month basis. As delivery approaches, the amount of copper sent to warehouses has increased. In addition, due to the weakening import price ratio, there are differences in the acceptable prices between buyers and sellers, and only some of the goods slated to arrive soon at the port are sold at low prices. In terms of consumption, downstream processing companies are still mainly replenishing stocks on demand against high copper prices. On the fundamentals, as of Monday May 13, SMM copper inventory across major Chinese markets decreased 2,100 mt from last Thursday to 400,100 mt, up 259,000 mt YoY. Due to the strong market optimistic sentiment, copper prices will move at highs.