The current copper prices lack sufficient bullish factors, and it is inevitable that copper prices will continue to decline in the future.
As it's only early November, there's still a ways to go until the end of the year. However, this year's merchants have a firm bearish outlook on next year's copper prices, and they've already started selling off stocks despite it not being the end of the year. On the downstream side, the cautious attitude this week has not changed, with terminal orders beginning to decline and only small quantities being purchased when inventory is nearly depleted. Actual consumption demand has not improved; instead, there are signs of an early entry into the off-season. Due to the sustained weak consumption of spot copper, the Shanghai Futures Copper has yet to stage a rebound, even as some companies are cutting production. Nonetheless, the market supply remains ample.
The recent copper scrap market exhibits two notable characteristics. Firstly, there is a scarcity of supply. Due to insufficient imports and the fact that the domestic copper scrap's报废 period has not yet arrived, a situation of supply not meeting demand prevails. The key factor is the reluctance of traders to sell, leading to a backlog of inventory. Some traders, with higher inventory costs, would incur losses if they sell now. Traders have explicitly stated that they will ship out goods if the bright wire price can reach above 38,000 yuan per ton.
Additionally, due to the lower price of scrap copper, many recyclers have changed their trades. It is learned that recyclers dealing with scrap copper, aluminum, and iron in various regions have decreased by about 2/3, making it difficult to collect supplies. Another notable feature is the unpaid debts at copper factories. Traders across regions are extremely troubled, as the unpaid debt situation is worsening due to the tightness in the capital chain. The delay ranges from a few weeks to a month, to as long as two months or more, severely affecting the traders' enthusiasm and the progress of receiving goods (usually involving cash transactions).