As the U.S. dollar rose before the annual meeting of the Jackson Hole Global Central Bank, copper prices and other industrial metals fell overnight, ending the rally earlier this week. However, in the commodity futures market, a rare phenomenon reappeared after a lapse of more than a year, which is causing some copper market bulls to smell a potential opportunity-refined copper prices are once again lower than scrap copper prices.
Copper prices are firm in the outlook

Copper is used in power and construction fields. Many analysts expect that as fossil fuels are replaced by electrification, demand for copper will be very strong. In fact, in addition to the above-mentioned rare inversion between scrap copper and refined copper prices, in some other areas, there is no lack of signs of optimism about the outlook for copper prices.

China’s Yangshan copper import premium has recently risen from US$21 per ton in June to more than US$100, which indicates that the Chinese market has stronger demand for overseas metals. China has always been the world’s largest copper buyer in the physical market.

In addition, the copper stocks in London Metal Exchange registered warehouses have dropped to 178,125 tons from nearly 240,000 tons a week ago. The LME spot copper price difference relative to the three-month contract has risen from a discount of approximately $30 in mid-August to a premium, which indicates that the supply of metals that can be delivered quickly is tightening.