I. Current copper price market situation
Copper in Luntong fell slightly, while copper in Shanghai fluctuated. The macro market as a whole was dull, US stocks were closed for Christmas, and the US dollar index fluctuated. Spot TC of copper concentrate is under pressure, and several ports in Inner Mongolia, Las Bambas, stop production and limit transportation. Chile may raise the mining tax, which will increase the disturbance of copper supply. The supply of recycled copper is still tight, the import of recycled copper is losing money, the price difference between refined copper and waste is decreasing, and the absolute value is far below the profit and loss point. Domestic warehouse receipt inventory decreased, LME copper warehouse receipt inventory increased, and the proportion of cancelled warehouse receipts increased. The spot premium of domestic futures has declined, Shanghai copper has a large discount in recent months, and LME copper spot premium has declined. On the whole, the macro market is dull, there is no big change in internal and external inventories, and the overall copper price is dominated by shocks.
Second, new energy and carbon neutrality: the engine of copper demand in the new era
The status of "carbon neutrality" in China's economic development is constantly improving. The Central Economic Work Conference proposed that China's carbon dioxide emissions should peak in 2030 and achieve the goal of carbon neutrality in 2060. We believe that new energy technology is an inevitable choice to achieve carbon neutrality, and global copper demand will gain new development space under these two trends.
Carbon neutrality requires the power industry to gradually transform into clean energy, and new energy sources such as photovoltaic and wind power infrastructure are expected to stimulate grid investment. According to Antaike data, China's electricity demand for copper accounts for 48.5%, and power grid investment has a significant impact on copper consumption. In the next five years, State Grid Corporation of China will invest more than 70 billion US dollars every year to promote the upgrading of power grid to energy interconnection network and promote the clean and low-carbon transformation of energy. In addition, under the background of "carbon neutrality", the world is vigorously developing new energy vehicles, and the increase of copper consumption for bicycles and the construction of charging pile network are also new increases in global copper demand.
Third, the double index judgment of copper price and PPI
Copper is the basic metal among the basic metals, which is called "the metal with a doctorate in economics" and is the most reliable leading indicator of the economic cycle.
With the economic downturn, copper prices (Luntong and Shanghai Stock Exchange's main copper) began to turn their heads upwards. At this time, you can start close observation and try to establish a small observation position. If PPI starts to turn head up, gradually add positions.
In the process of overheating, copper prices began to turn head down (for example, in May this year) and entered a close observation; If PPI starts to turn head down (June this year), gradually withdraw.