China Nonferrous Metals Industry Association: Analysis of copper industry operation situation in January 2024
In January 2024, the operation of China's copper industry showed the following four characteristics:
1. The production and operation of copper smelting enterprises are basically stable.
In January, the main interference factor for the output of domestic copper smelting companies still came from the continuation of 2023. Affected by factors such as the approaching Spring Festival holiday, the statistical cycle of production companies, and the continued decline in spot processing fees for copper concentrates, the enthusiasm for production of copper smelting companies has increased. reduce. In January, the copper cathode output of copper smelting companies decreased slightly compared with December 2023, but increased compared with the same period last year.
In January, the spot processing fee for copper concentrate continued the rapid downward trend in December 2023. The spot TC quotation for copper concentrate fluctuated in the range of US$32 to US$60/ton that month; it fell to nearly US$30/ton during the month, falling back to April 2021. The monthly level has fallen below the average manufacturing cost of the domestic copper smelting industry, seriously dampening the production enthusiasm of copper smelting companies.
2. Downstream production is stable and the terminal market remains resilient.
Overall, demand in the domestic downstream copper industry was relatively stable in January. Under the influence of seasonal factors, although the demand side performed better than the same period last year, many copper companies had limited orders on hand that month and had poor expectations for the market outlook, resulting in low enthusiasm for stocking up before the Spring Festival. In January, end market consumption remained resilient. On the one hand, the investment in power grids has grown rapidly, and the order volume of cable companies has been acceptable; automobile production and sales have continued to maintain a high level, and the growth rate of new energy vehicle production has slowed down. The air-conditioning industry has increased production due to the start of stocking before the Spring Festival. On the other hand, real estate consumption performance was weak at the end of the year; the air-conditioning industry was in the traditional consumption off-season, and its production and sales performance was poor.
3. Copper prices fell slightly
In January, copper prices fluctuated slightly and declined. The LME 3-month copper price opened at US$8,586.5/ton, with a high of US$8,704.5/ton on January 31, a low of US$8,245/ton on January 18, and closing at US$8,615.5/ton, which was lower than that in December 2023. It rose by US$53.5/ton, or 0.62%.
The average LME copper prices for the current month and three-month futures were US$8,343.5/ton and US$8,442.2/ton respectively, down 7.3% and 6.4% year-on-year respectively, and down 0.6% and 0.5% month-on-month respectively. The trend of Shanghai copper in the internal market is basically the same as that in the external market. The average price of SHFE copper in the current month and three-month period was 68305.5 yuan/ton and 68342.8 yuan/ton respectively, a year-on-year increase of 0.9% and 0.6% respectively, and a month-on-month decrease of 0.7% and 0.03% respectively.
4. Refined copper imports slightly decreased
Customs data is delayed compared to other industry data. The latest data shows that in December 2023, my country's refined copper imports decreased year-on-month, with imports reaching 339,000 tons, a year-on-year decrease of 6.9%, and a month-on-month decrease of 15.3%; copper concentrate imports were 2.484 million tons, a year-on-year increase of 18.1% %, a month-on-month increase of 1.6%. In December 2023, domestic refined copper production increased significantly, the price difference between refined and scrap expanded, the role of scrap copper in replacing refined copper gradually increased, and the shortage of refined copper resources in the market was alleviated. Although the import profit narrowed that month, imports The window remains open.
In December 2023, the import volume of recycled copper was 193,000 tons, a year-on-year increase of 38.8% and a month-on-month increase of 5.5%. In December 2023, the import volume of scrap copper increased both year-on-year and year-on-year. This was mainly because as the price of refined copper increased, the price difference between refined copper and scrap widened, and the role of scrap copper in replacing refined copper increased. Domestic refined copper resource inventories Due to low volume and tight supply, some waste-recycling companies are importing scrap copper to maintain production.
It is initially expected that China's copper industry prosperity index will still operate within the "normal" range and may maintain a downward trend.
