The Market Rebounds and Raw Materials Rise

In the week of November 27, China’s domestic spot copper prices trended strongly. The average copper price of Changjiang Nonferrous Metals Net 1# reported at RMB 54,826/ton, an increase of RMB 1,678/ton compared to last week, an increase of 3.16% from last week.

There are still some disturbances at the mine. The strike at the Candelaria copper mine under Lundin Mining has ended, but the Cantinela copper mine under Antofagasta may go on strike. The Chilean Copper Commission (Cochilco) stated that Chile’s copper production may increase by 0.6% in 2020; if new projects cannot be advanced as scheduled, Chilean copper mine production will face severe challenges.

China’s copper ore imports fell in October. Overseas copper scrap suppliers are cautiously exporting to China, and it is difficult to supplement short-term imports. LME inventories have remained depleted recently, and Chinese demand has performed well. Copper inventories on the Shanghai Futures Exchange are also declining. The traditional off-season consumption has not been weak. The production and sales of automobiles and other fields are booming. The vaccine news boosted market optimism and copper prices strengthened.

Another factor contributing to the increase in the price of copper and plastic raw materials is that China’s orders for electronic products have also skyrocketed, because some electronic products require copper and plastic.

In addition, when Apple’s mobile phones sell cost phones, they no longer give away chargers and earphones, so users are currently demanding orders for chargers or adapters and earphones.

Finally, our small water pump industies, fountain water pump, garden water pump, air cooler water pump, RO booster pump, etc. all require raw material of copper and plastics. Therefore, our water pump industry is facing the dilemma of rising costs, especially as we discussed earlier. The orders in fixed price between Both Parties before but no production are facing the rising cost of raw materials, making pump manufacturers face unprecedented pressure.

Regarding the issue of raw materials next year, many manufacturers have no idea whether the cost of raw materials will fall. We have no choice but wait .

Post time: Dec-12-2020