Spring Breeze Warms Copper Stranded Wire Affected By Copper Prices

In February, the non-ferrous metals were all weak and consolidated. Mainly affected by the factors of the New Year, the spot is weak, which makes the fluctuation of the market more stable. Copper, which was weak in the early stage, is now stable, and London copper remains at around 5,700 US dollars.

Metals basically ushered in changes in the first quarter. The first is the change of all micro-elements: the gradual tendency to clear easing signals is very good support for the non-ferrous species, especially the "Dr. Copper" who is closely related to the micro-economy. After the domestic interest rate cut, there is still a lot of room for easing monetary policy. In addition, the continued strength of the US dollar and the expected reduction in the value of the RMB will make the domestic monetary policy tend to be looser, which will continue to bring a better bottom-up effect for non-ferrous metals. With the improvement in the quality of economic growth, there is a high probability that A-shares will continue to be bullish. Of course, judging from the cycle of Merrill Lynch, during the economic recovery, the stock market performed better than the product. We believe that the probability of the product bottoming out and then rebounding is very high. Currently, non-ferrous metals are still in the process of bottoming out.

From the perspective of supply and demand, the output value of refined copper in December last year was 830,000 tons, which was greater than the output value of copper stranded wire, and the refined production capacity rewrote the operating rate to a new high. As the mines enter the peak production period, this high growth trend may be maintained until 2016. The International Copper Research Institute (ICSG) estimates that demand growth in 2015 may be only 1.1%, which is mainly caused by the low growth rate of economies other than China. Of course, there is great uncertainty in spending, and it is not difficult to digest the surplus of hundreds of thousands of tons. For example, the state reserve purchases and reserves, and the investment consumption in certain fields increases, etc., it is easy to change the supply and demand situation.

From the perspective of upstream supply of aluminum, the import of bauxite in February was still affected by climatic factors, and aluminum alloys were also affected to varying degrees. However, on the one hand, incomplete statistics show that the domestic alumina supply and output value may reach a new high, domestic alumina quotations have continued to decline, and the prices of aluminum alloy strands and aluminum-clad steel strands have also declined, which has a certain impact on the cost of aluminum prices. drop down effect. In terms of production capacity investment, the first quarter is the moment when Xinjiang, Inner Mongolia and Liaoning continue to invest in new production capacity. For the situation that the aluminum price is fluctuating around 13,000 yuan, there is no price-sensitive element in these production capacities. Therefore, the rhythm of capacity release is still relatively fast. In terms of operating rate, the current operating rate of electrolytic aluminum smelting capacity is 86.92%, which is higher than the previous month. The continuously rebounding smelting operating rate data shows that there is a lack of rebounding space for the current aluminum price.

In December last year, the domestic refined zinc output value was 539,700 tons, a slight decrease from the previous month. On the supply side, although the supply of mines is expected to remain serious, the supply of concentrates is still generous. However, we still estimate that it will be difficult for the supply-side performance to increase significantly in the future and continue to maintain a moderate growth rate. Considering from the cost side, due to the environmental protection pressure in the new year, the company's refined cost has increased by a large margin on average. In view of the current low quotation situation, there is a lack of shipping momentum. The current spot zinc is weak, but the downstream demand may increase in the future, which will drive the tightness of the spot. Inferior industries are affected by factors before the festival, and the operating rate is generally lacking, and the operating rate of key galvanizing companies is less than 60%. At the same time, due to the lack of motivation of low-end companies to hoard goods, they are weak due to the influence of New Year elements.