[may 14 SMM copper morning meeting minutes] the import window continues to open and the import copper premium rises further

5.14 Summary of Bronze Morning meeting

[5.14 SMM Bronze Morning meeting minutes] Macro aspect: 1) in a speech on current economic issues, Federal Reserve Chairman Powell said: the US economy is facing unprecedented downside risks, and the Federal Reserve will use all policy tools until the economy recovers, but will not adopt a negative interest rate policy. [bearish] 2) US PPI fell 1.3% month-on-month in April and is expected to fall 0.5%, down 0.2% from the previous value, and 1.2% from a year earlier, the biggest drop since November 2015. OPEC monthly report: OPEC crude oil supply increased by 1.8 million barrels per day in April to 30.4 million barrels per day, and cut its crude oil demand forecast for the second quarter by 3 million barrels per day. It is expected that the existing OPEC+ production reduction agreement is difficult to change the serious oversupply situation [bearish / negative] fundamentals: 1) the scrap price difference of scrap copper yesterday was 625 yuan / ton (5.9% calculated at the ticket point). Copper prices fell again yesterday, scrap copper merchants less willing to ship, profit waste enterprises to purchase scrap copper significantly reduced, is expected to wait for copper prices to rise again before the supply will gradually increase. In addition, according to SMM, due to the recent improvement in scrap copper supply compared with February-March, many scrap copper rod enterprises have resumed production in April and early May. At present, although scrap copper supply is still tight, it can still maintain normal production. [bearish] 2) imported copper made a profit of about 200 yuan / ton yesterday. The foreign trade market remained active yesterday. The import price ratio continues to open, the buyer's inquiry is active, and the bill of lading to Hong Kong at the end of May is very popular. However, the supply is scarce, some traders intend to import their own, so the quantity of offer is limited, and the quotation is further raised. The transaction of the bill of lading arriving in Hong Kong in mid-early June was slightly worse, mainly because the buyer expected the premium to be difficult to maintain, so he held a cautious wait-and-see attitude. Warehouse receipts are still scarce and traders basically do not make quotations. 3) LME copper stocks decreased by 2725 tons to 227025 tons on May 13, while copper warehouse receipt stocks in the previous period increased by 1368 tons to 65916 tons. [neutral] 4) spot East China: at present, the monthly difference has been significantly narrowed, the willingness of holders to sell has weakened, the discount has been rapidly narrowed, approaching delivery, the activity of traders has increased, and copper futures have also attracted downstream bargains after falling. Today's transactions are expected to continue to improve, spot discount 10-20 yuan / ton. South China: Guangdong electrolytic copper spot contract rose 30% to 40% yesterday. Spot market, Guangdong spot discount once again staged high platform diving, but different from the previous day is a significant increase in the number of receivers. Some of the downstream users take advantage of falling copper prices and rising water to carry out appropriate replenishment when the price of copper is low; some of the time traders pick up copper for delivery. Overall, after a sharp decline in rising water, the market trading activity increased significantly. The rise and fall are expected to remain stable today and will not fall sharply again. Copper price and forecast: last night, Lun copper closed at $5212 / ton, down 0.33%, trading volume 13000 hands, short positions increased 2807 hands to 270000 hands; Shanghai copper main company 2006 contract closed at 43060 yuan / ton, up 0.08%, trading volume 78000 hands, short positions reduced 8 hands to 115000 hands. Copper prices rose and fell last night, as crude oil boosted the European session as Saudi Arabia and Russia said they would try to balance supply and demand for crude oil. The rebound in oil prices led to stronger copper prices, which rose to $5271 a tonne in external trading. In the second half of the night session, as Federal Reserve Chairman Powell said he was pessimistic about the future of the US economy, but did not consider using negative interest rate instruments for the time being, and the market doubted the enforceability of his call for greater fiscal policy, market sentiment turned pessimistic. Safe haven dollar gold rose, driving copper prices down. In terms of spot, it is expected that today's copper 5190-5250 / ton, Shanghai copper 42800-43200 yuan / ton. Perch