According to the Bloomberg Commodity Index, the global price of various types of metal ore into the recovery of the road. Metal aluminum rose more than 20% this year, the first week of August aluminum prices rose to 2,000 US dollars / ton, to the highest level since December 2014 the highest level. Aluminum prices are still significantly higher than the 50 and 200 day moving average. Since the beginning of this year, the international market rose 110.3% cobalt prices, palladium rose about 39.5%, platinum rose 5%, lithium carbonate rose 11.15% in the past six months. Small metal industry mergers and acquisitions, acquisition activities also increased significantly. Copper prices in the second quarter of this year, stagnant, but July copper prices rose 7%. Many experts expressed optimism about the copper market in the next few years. Goldman Sachs and other companies forecast soon after the supply shortage, leading to further rise in copper prices. Last year, global lead production remained strong, as the world’s largest lead producer China’s environmental protection requirements this year to further improve. Sichuan Province environmental inspector has led to about 60% of the local zinc-lead mine shutdown, other areas of many small “three no” renewable lead enterprises have also been fined off. A large amount of hidden refined lead production has vanished, implying that lead supply will tighten further over the next few months. Another key factor is the decline in inventories. Since mid-May, the London Metal Exchange (LME) lead stocks fell 17%, cancellation of warehouse receipts by 40%. According to the International Lead and Zinc Research Group report data: 2017 years ago, the global lead market demand rose 11.15%, of which the United States rose 22%, China rose 16.4%, Europe rose 1.5%, the global lead market supply gap of 68,000 tons

In the first quarter of this year, mining financing amounted to $ 9.57 billion, up from the fourth quarter of last year ($ 7.14 billion), almost doubling year-on-year ($ 5.14 billion) and mining financing activity improved significantly. The amount of financing for the initial and mid-level exploration companies, as a sharp decrease in April, decreased from 235 to 158 in March, but the amount of financing increased from $ 726 million in March to $ 1.23 billion, up 70 %. This is the second highest month since July 2014, showing that social capital’s confidence in mining prospects is recovering. Many companies not only began to use the remaining funds to carry out mineral exploration, but also to carry out the acquisition activities. At the same time, there are some mining companies have been repurchasing debt, showing signs of recovery.

September 14, the Asian region ethylene market prices stabilized, CFR Northeast Asia closing price unchanged, to close at 1314-1316 US dollars / ton; CFR Southeast Asia closing price unchanged, to close at 1199-1201 US dollars / ton.

September 14, the US regional ethylene market closing price rose 11 US dollars / ton, FD US Gulf prices closed at 683-694 US dollars / ton.

September 14, the European ethylene market closing prices were mixed, FD Northwest Europe prices rose 1 euro / ton to close at 1018-1023 euros / ton; CIF Northwest Europe prices fell 1 US dollars / ton, to close at 1198-1202 US dollars /Ton.

August copper prices are inferior to other non-ferrous metals, but the cumulative increase is not small. Especially LME Lun copper, in August rose nearly 7%, quietly approaching 7,000 US dollars / ton. From the supply and demand fundamentals, copper prices support factors still exist, is expected to continue a strong pattern.

Copper supply elasticity still no relief

2017 – 2019, the new copper mine supply is not much, in 2017 the total production of small and medium-sized mines about 20.8 million tons. While the 2018 small and medium enterprises is expected to increase the amount of 285,000 tons; 2019 is expected to increase production of 245,000 tons. Therefore, the total supply of refined copper is largely dependent on the supply of copper concentrates, and the supply of refined copper will remain if global demand remains moderate due to lower supply growth. However, since the end of 2016, copper prices rose sharply, the future prospects of investment is very large, mainly concentrated in Peru, Chile and other countries, of which Peru’s potential investment capacity can be as high as 3.5 million tons, Chile, about 2.95 million tons, plus Ecuador 1 million tons, as well as other countries may invest in production capacity, the overall global potential capacity increase can be as high as nearly 8 million tons, but due to strong copper construction cycle, even if the immediate investment is expected to peak at least until 2022, Therefore, 1-2 years do not have to worry about copper oversupply.

Copper concentrate processing fee is low

CSPT set the third quarter processing fee bottom line of 86 US dollars / ton, 8.6 cents / lb, but since its set processing fees since the bottom line, the spot market processing fees continued to hover in the 79-85 US dollars / ton, 7.9-8.5 Cents / pound, continued lower than the processing company set the processing of the bottom line, limiting smelting enterprises from the spot market to purchase copper concentrate, thereby limiting the refined copper production. With the fourth quarter approaching, China refined copper production capacity or continue to put, while the copper concentrate supply elasticity is relatively small, which will further intensify the contradiction between copper supply and smelting capacity. In addition, the fourth quarter is also facing annual processing fees negotiations, smelting enterprises and mining between the game or more intense, whether it is smelting enterprises to reduce the spot copper procurement or mining reduction copper mine are not conducive to the release of refined copper production.

In addition, the current spot market processing fees have been approaching the smelting business smelting profit and loss line, if the fourth quarter once again smelting capacity to run, or make the processing fee below the overall profit and loss balance of smelting enterprises, will eventually make smelting production forced to decline. As a result, the supply of refined copper in the coming quarter is limited.

It is estimated that in 2017 China’s refined copper demand increase or 300,000 tons, while the August tracking situation shows that the main energy of the national grid basically the same, still on the elimination of renewable energy, to expand the field of alternative energy, these copper demand Pulling limited. However, with the passage of time, after entering the fourth quarter, short-term consumption season season has a certain role in promoting, mainly the current industry chain inventory are relatively low. The key to the demand for copper in the Trump infrastructure plan is whether the grid can be modified. Even if the implementation of the entire cycle dragged on a long, supply enough time to achieve matching.

In August, the world’s three major exchanges inventory, LME inventories fell 69,000 tons, COMEX inventories increased by 11,000 tons, SHFE inventories increased by 0.5 million tons, the global inventory in August net reduction of 53,000 tons. Due to refined copper supply elasticity is getting lower and lower, we believe that the overall decline in copper stocks into the pattern.