In The First Quarter of 2023 The US Copper Rod Prices
North America
In the first quarter of 2023, the
US market experienced a rise in Copper Rod
prices due to the banking meltdown's impact on high inflation and
high-interest rates. Market players had noted that lower copper prices led to
increased market demand ahead of traditionally high-demand months, such as
April and May. As market participants looked for signs of a solid post-pandemic
recovery, a slowdown in inventory build-up had indicated a rise in demand, and
lead times had also been reduced due to lower input demand and fewer logistical
delays. This improvement was driven by a sharp drop in input purchasing by
manufacturers. Firms had chosen to deplete inventories as stocks of purchased
and finished goods contracted. Additionally, the failure of Silicon Valley Bank
in mid-March had a modest impact. The US dollar had also risen against most
major currencies, reversing recent losses. The market's preference for
safe-haven assets had remained high due to continuing concerns about banking
industry risks. Downstream businesses had taken a wait-and-see approach in the
face of high copper prices. As a ripple effect, the Copper Rod (C110-1 inch)
prices for Ex Alabama (USA) settled at USD 15698/MT.
Asia Pacific
In the first quarter of 2023,
Copper Rod prices in the Chinese market increased due to a surge in Copper
futures and limited global copper stocks. Initially, Copper prices began
positively with the return of funds in anticipation of China's exit from a year
of lockdowns. However, the Spring Festival holiday in January, coupled with
off-season consumption, caused downstream replenishment to remain weak, and
spot market transactions were scarce. As Q1 progressed, demand rose as
terminals, processing plants, and downstream businesses resumed production, and
orders for Copper Rods increased. The sellers prioritized the delivery of
long-term orders, and downstream companies took a wait-and-see approach in the
face of high Copper
Wire Prices. With the Chinese economy improving steadily,
downstream demand is gradually improving as well. Overseas availability remains
limited, which supports copper prices. As a ripple effect, the Copper Rod (20
mm) prices for Ex Shanghai and FOB Shanghai were fixed at USD 7300/MT and USD
7346/MT at the end of the first quarter of 2023.
Europe
Throughout the first quarter of
2023, the Copper Rod prices in the US market rose owing to the uptick in the
downstream construction and machinery inquiries amidst banking sector turmoil.
Buyers chose long-term contracts, avoiding the spot market. Potential supply
disruptions from protests in Peru and a planned Utah smelter outage were noted
but delayed shipments from Peru and Chile led to increased interest in copper
scrap, and US premiums remained stable. Silicon Valley Bank's failure had
little impact, and the US Fed's interest rate hike had little influence.
Traders dominated spot market trades, and downstream buyers restocked as
needed. Sellers prioritized long-term purchases, and import losses increased,
reducing the possibility of significant inflows of imported goods. High copper
prices kept buyers cautious, and trading was sluggish, with Copper Rod (25mm)
prices for Ex Berleburg and FOB Hamburg fixed at USD 11708/MT and USD 11769/MT
at the quarter's end.
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