COMEX Copper Review for October 23rd

New York, October 23: Copper futures on the Chicago Mercantile Exchange (COMEX) rose on Monday, the third increase in four trading days, mainly due to the weakness of the U.S. dollar.

As of the close, copper futures rose by 2.2 cents to 3.1 cents, with the most actively traded December 2023 copper futures closing at $3.5865/lb, up 2.35 cents or 0.66% from the previous trading day. This is also the largest single-day increase since October 6.

December copper futures traded in a trading range of $3.5195 to $3.5945.

The U.S. dollar index fell 0.62% on Monday, meaning copper priced in U.S. dollars is cheaper for buyers holding other currencies.

Judging from the demand from China, the top metal consumer, although the real estate industry is still sluggish, China's demand for copper and aluminum is unexpectedly strong, mainly benefiting from orders from the home appliances, electric vehicles, solar and wind energy industries.

The recent COMEX copper futures contract has fallen 4.11% so far this month and 6.11% so far this year. Monday's closing price is still 2.69% higher than the same period last year. COMEX copper futures fell 14.6% in 2022, mainly because the global economic growth outlook is worrying. High inflation has prompted European and American central banks to actively raise interest rates to curb inflation, exacerbating the risk of economic recession. By comparison, copper in 2020 and 2021 has recorded gains of 25% for two consecutive years. The green transformation of the global economy and electrification have helped boost additional demand for this metal widely used in the power and construction industries, while copper mines are facing Disruptions such as underinvestment and production disruptions.

From the perspective of fund dynamics, position data released by the U.S. Commodity Futures Trading Commission (CFTC) shows that speculative funds have significantly increased their net short positions in the U.S. copper futures market. As of October 17, speculative funds held a net short position of 21,553 lots in the COMEX copper futures and options market, an increase of 16,437 lots from a week ago. For comparison, there were net purchases of 7,859 lots last week.

The December 2023 copper contract on the Shanghai Futures Exchange closed down 720 yuan on Monday at 65,920 yuan per ton. Bonded copper futures for December on the Shanghai International Energy Trading Center (INE) fell 770 yuan to 58,470 yuan per ton.

In the registered warehouse of the Shanghai Futures Exchange, copper inventories were 58,223 tons on Friday (20th), an increase of 11,419 tons from 56,894 tons a week ago. This is the second consecutive week of growth and is still higher than the peak of 252,455 tons at the end of February. tons fell by 76.9%.

On Monday, the trading volume of COMEX copper futures was 97,729 lots, compared with 87,712 lots on the previous trading day; the short volume was 225,449 lots, compared with 221,104 lots on the previous trading day.