On Friday, Shanghai copper main 2505 contract opened high volatility, the trend is strong. As of 10:15, the offer was 80,320 yuan per ton, up 0.80%. The spot market trading atmosphere has increased, and the willing to hold the goods is strong, and the goods are higher. Downstream on the weekend, there is no shortage of catch-up reserve moves, just need to deal steadily, continue to drive market trading heat, trading surface performance is OK. • The average price of spot 1# electrolytic copper was 80,190 yuan/ton, up 310 yuan/ton from the previous trading day, and the premium was 110 yuan/ton. On the macro level, the US President has made it clear that he will not change the tariff policy on Canada, and plans to impose retaliatory tariffs of up to 200% on alcohol products from the EU. This series of measures triggered the continued escalation of the global trade situation, the US dollar rebounded upward, the stock market and crude oil collectively fell, and the market risk appetite cooled. Europe and the United States are also planning countermeasures against each other's steel and aluminum products, further exacerbating the uncertainty of global trade. This uncertainty has led to a decline in investor confidence in the metals market, putting some pressure on copper prices.
In addition, the news that the US President met with the NATO Secretary general and threatened to seize Greenland again triggered an escalation of geopolitical conflicts. Geopolitical instability has also had a negative impact on metals markets, adding to risk aversion. In the face of geopolitical risks, investors are often more inclined to choose safe haven assets, rather than risk assets such as non-metals. U.S. economic data, however, came in below market expectations. Initial claims for state unemployment benefits fell 2,000 to 220,000 for the week ended March 8, the Labor Department said on Thursday. At the same time, another set of data also showed a gloomy, the US PPI in February rose 3.2%, the growth rate was lower than the expected 3.3% and the previous 3.5%. Us core PPI rose 3.4% YoY in February, below the 3.5% expected and 3.6% previously. U.S. wholesale inflation growth fell in February, helped by a drop in the cost of services, data showed, suggesting an easing of price pressures ahead of additional tariffs imposed by the Trump administration, though it also gave the Federal Reserve room to cut interest rates further this year. Supply and demand fundamentals: Mine tightness continues to provide support for copper prices. Since the beginning of the year, the spot TC of copper concentrate has continued to decline and has fallen to negative values, showing the tightness of copper mine supply. In addition, domestic refineries are subject to the shortage of raw materials at the mine end and the cold end, and the production release is less than expected. In terms of inventory, London copper inventories and domestic copper warehouses have shown a trend of de-stocking, showing the tightness of the copper market supply. On the demand side, data released by the State Grid show that investment will exceed 650 billion yuan this year, an increase of 8%. Domestic copper consumption growth is expected to rebound to 4.6% and global consumption growth to 3%. The data point to strong demand in the copper market. Industry news: Panamanian President Mulino announced on March 13 that he had approved the sale of copper concentrate from First Quantum Mining's Cobre Panama copper mine, a move that prompted First Quantum shares to surge 15% on the Toronto Stock Exchange to a two-month peak. On the other hand, Indonesia's Freeport copper miner said it was actively seeking copper concentrate export licenses after receiving approval from the mining minister for a revision of its annual business plan. Combined with the above factors, copper prices are expected to maintain a strong volatility in the short term. Despite pressure from escalating trade tensions and geopolitical conflicts, it is supported by tight supply and demand. The US copper tariff premium is expected to increase, affecting the metal market pricing. Investors need to be alert to technical resistance and changes in the overseas trade situation, and timely adjust investment strategies. Pay attention to the lower support level of 79,000 yuan/ton and the upper pressure level of 80,500 yuan/ton.
