Expert copper market insights
Our quarterly copper outlook is published in our Quarterly Metals Report, which covers base, precious and ferrous metals. The impact of supply and demand fundamentals, including LME and SHFE stocks and macroeconomic implications for the copper futures and spot prices are analysed. Our research team produce a copper price range forecast as part of the report.
Copper Outlook – Q1 2024
Copper has been subject to fluctuations, creating parallels with aluminium's trend. The day-to-day narrative driving copper prices has been influenced by macroeconomics and China's economic outlook. However, the stronger dollar may be capping any substantial upside gains. Supply disruptions are creating uncertainty about the outlook for copper concentrate this year. We expect a finely balanced market, which could see a more significant deficit next year. The outlook trajectory for copper depends heavily on China, and we anticipate copper prices to fluctuate with a slight upside skew in Q1 2024.
During the last quarter, the markets expected the Fed to begin a cutting cycle, which caused the dollar and Treasury yields to decrease. This, along with predictions of China's recovery in 2024, boosted the prices of base metals by the end of the year. However, in Q1, the situation has changed. The US economy has shown robustness in terms of the labour market and consumer performance, which has led the market to price in the probability of cuts further down the curve. Additionally, despite continued support from the government, Chinese pessimism has yet to subside. In the upcoming months, macroeconomics will continue to play a crucial role in driving the day-to-day momentum, particularly in the aluminium and copper markets. Structural and cyclical indicators will also come into play when assessing the path for base metals performance. COT positioning, spreads, and stocks will drive the general price trend in the first half of the year while anticipating an economic recovery and easing monetary policy pressures in the latter half of the year.
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