|
China’s extensive COVID lockdowns, which started in March, have crippled demand for copper, leading to higher exports. The country exported 116,461 mt of unwrought copper, and copper products in April, nearly double the pre-lockdown volume of 58,710 mt in February, according to customs data released on Wednesday. April’s volumes were the highest since May 2016, and 53% greater than April 2021. Data released earlier this month by China’s National Bureau of Statistics shows that manufacturing activity in April slowed due to lockdowns, weighing on copper demand and prices. Compared to March, refined copper production was down 37,000 mt in April, as the country produced 935,000 mt in March and 898,000 mt in April, according to the National Bureau of Statistics. |
|
|
|
LME Copper prices have weakened as China’s demand has stalled. The 3M contract is down nearly 14% (7:10AM CST) from the March highs. Using simple hedges such as swaps and call options could help copper consumers protect margins. These could cap your copper costs, guarding against a price recovery. Such positions are standard for consumer hedging, but they can result in opportunity costs or cash costs if metal prices decline. Please contact AEGIS for specific strategies that fit your operations. (5/19/2022) |
||
|
|
||
Note: Clients with AEGIS Platform access can see this and other research, plus hedge portfolio reporting and tools here. |
||
|
|
||
Price Indications |
||
|
|
||
|
|
||
Today's Charts |
||
 |
 |
|
 |
 |
|
AEGIS Insights |
||
|
05/18/2022: AEGIS Factor Matrices: Most important variables affecting metals prices 05/11/2022: China's Metals Exports are on the Rise |
||
|
|
||
| Important Headlines | ||
|
5/16/2022: Shanghai targets June COVID lockdown exit as China economy slumps 5/16/2022: Column: European smelter hits mean another year of zinc shortfall 5/16/2022: Europe's aluminium deficit triggers further large LME stock draw |
||
|
|
||
|
|
||
|
Important Disclosure: Indicative prices are provided for information purposes only, and do not represent a commitment from AEGIS Hedging Solutions LLC ("Aegis") to assist any client to transact at those prices, or at any price, in the future. Aegis makes no guarantee to the accuracy or completeness of such information. Aegis and/or its trading principals do not offer a trading program to clients, nor do they propose guiding or directing a commodity interest account for any client based on any such trading program. Certain information in this presentation may constitute forward-looking statements, which can be identified by the use of forward-looking terminology such as “edge,” “advantage,” “opportunity,” “believe” or other variations thereon or comparable terminology. Such statements are not guarantees of future performance or activities.
|
||
