The Copper price has seen some recovery recently, but according to Commerzbank’s commodity analyst Carsten Fritsch, poor sentiment indicators in the manufacturing sector have left their mark. Fritsch notes that the weak construction sector is acting as a brake for Copper, with sentiment in China deteriorating further and the Caixin index falling below 50.
In addition to the negative sentiment in China, the ISM index in the US also disappointed and fell significantly below 50. Reports from the Chinese research group Antaike have forecast falling Copper prices in the second half of the year, as steady production growth in the Copper refining industry is facing weak demand growth. Demand in China is expected to grow by only 2.3% this year, compared to a 5.3% increase in the previous year.
Antaike predicts a global supply surplus of 300 thousand tons on the Copper market. Despite the negative outlook for Copper, Antaike is more optimistic about base metals such as aluminium and zinc. The greatest price potential is seen for tin, according to the research group. With the weak construction sector acting as a brake on Copper demand, the market is facing challenges in the coming months.
Overall, the outlook for Copper prices remains uncertain due to the weak sentiment in the manufacturing sector and the forecasted global supply surplus. With demand growth in China expected to be lower than the previous year and steady production growth facing weak demand, the market is at risk of facing further challenges. Antaike’s forecast of falling Copper prices in the second half of the year adds to the negative sentiment surrounding the commodity.
Despite the challenges facing the Copper market, Antaike is more optimistic about other base metals such as aluminium and zinc. The research group sees the greatest price potential for tin, suggesting that investors may want to look at alternative base metals for potential opportunities. With the weak construction sector acting as a brake on Copper demand, market participants will need to closely monitor developments in the coming months to assess the potential impact on prices and market dynamics.
As the global economy continues to navigate through uncertainties, the Copper market is facing challenges from weak demand growth and a supply surplus. Investors and market participants will need to carefully monitor sentiment indicators in the manufacturing sector and developments in key markets such as China and the US to assess the potential impact on Copper prices. Antaike’s forecast of falling prices in the second half of the year adds to the negative sentiment surrounding Copper, highlighting the need for caution in the market.
