During the Spring Festival holiday, the overall price trend of non-ferrous metals was weak. As of the close of February 3, London copper prices closed at $9110 / ton, an increase of 0.26% from January 27; The price of Lun aluminum closed at $2,620.5 / ton, an increase of 0.46% from January 27; The price of zinc in London closed at $2089 / ton, down 1.00% from January 27; The price of Lun nickel closed at $15.075 / ton, down 3.15% from January 27; London lead prices closed at $1,945 / ton, down 0.38% from January 27; The price of Lensy is still slightly stronger due to the supply-side impact, closing at $29,945 / ton on February 3, an increase of 1.18% from January 27.
Overseas macro changes greatly
From the overseas economic data, the US consumption resilience is still there, and the eurozone economic growth has slowed down. In the fourth quarter of 2024, the real GDP of the United States at an annualized rate of 2.3%, lower than the expected value of 2.7% and the previous value of 3.1%, and the GDP growth of the United States in 2024 was 2.8%, slightly lower than the 2.9% in 2023. In the fourth quarter of 2024, euro area GDP grew by 0, lower than the market expectation of 0.1 percent, and the previous value was 0.4 percent. Year-on-year growth was 0.9%, below the expected value of 1.0%, the previous value of 0.9%, the overall growth has slowed.
On February 1, Trump invoked the National Emergency Economic Rights Act (IEEPA) to impose tariffs on imports from Canada, Mexico and China. Specifically, the Trump administration has imposed an additional 25% tariff on Canadian imports, while imposing a relatively low 10% tariff on Canadian energy resources. An additional 25 percent tariff was also imposed on imports from Mexico; An additional 10 percent tariff was imposed on imports from China. Trump's tariff policy has intensified political tensions between the United States and Canada and Mexico, increasing the uncertainty of macro factors, and commodity market volatility will also be amplified.
The Federal Reserve suspended interest rate cuts, the European Central Bank cut interest rates "boots" landed, and the Bank of Japan said it was still possible to raise interest rates in the future. In January, the Federal Reserve announced a pause in interest rate cuts, largely in line with market expectations. Looking forward to the future market, the probability of the Federal Reserve to maintain the suspension of interest rate cuts is larger in March, but the interest rate cut expectations may fluctuate; In January, the European Central Bank cut interest rates by 25 basis points, and after the interest rate meeting, officials collectively released a "dovish" signal, which is expected to see more interest rate cuts by the European Central Bank in the first half of 2025. On January 29, the minutes of the BOJ meeting showed that members agreed that inflation expectations had risen moderately; On January 20, the deputy governor of the Bank of Japan, Ryozo Ikimino, said that a positive cycle of "Japan's economic growth, wage growth, and productivity improvement" has been formed, and the market expects the Bank of Japan to carry out a "gradual interest rate hike".
Fundamentals are expected to remain strong
From the fundamental point of view, during the Spring Festival holiday, market supply remained stable, consumption was weak, and after the Spring Festival holiday, the library was expected to be strong. From the perspective of varieties, the global copper mine continued to supply tight situation, the spot TC index of imported copper concentrate turned negative, smelting profits continued to suffer significant losses, the production of mineral crude copper was limited, and waste crude copper contributed the main increase. In January, due to the implementation of the reverse billing policy, the supply of scrap copper is expected to decrease, coupled with seasonal maintenance, domestic electrolytic copper production is expected to decline, but the overall high; The consumer side is weak, before the Spring Festival holiday, downstream enterprises have opened the Spring Festival holiday, the operating rate is at a low level, and the risk of accumulation is greater. In terms of electrolytic aluminum, before the Spring Festival holiday, enterprises reduced production, electrolytic aluminum production capacity remained high, and demand was affected by the Spring Festival holiday, and downstream enterprises reduced production more. In addition, alumina prices exercise loose cost side support, short-term or pressure. Shanghai zinc, into January, the mine end of the tight supply is expected to gradually honor, domestic zinc concentrate processing fees to repair to more than 2000 yuan/ton, imported zinc concentrate processing fees to positive, insufficient raw materials to the smelter production restrictions weakened, smelter profits improved, more than maintain normal production during the Spring Festival holiday. The demand side is in a stagnant state due to poor consumption and the Spring Festival holiday, and the supply and demand are weak, and the risk of accumulation is greater. Lead market, the original lead smelter to maintain normal production, recycled lead smelter is due to environmental control and raw material restrictions, stop production more holidays, considering that waste battery recyclers resume production later than smelting enterprises, the overall lead price is easy to rise and fall.
Market outlook and investment strategy
On the whole, during the domestic Spring Festival holiday, the Federal Reserve announced the suspension of interest rate cuts, basically in line with market expectations, Trump used some tariff chips to impose tariffs on imported products from Canada, Mexico and China, the US dollar index trend is strong, and the non-ferrous metal plate is under pressure as a whole.
Looking forward to the future market, on the one hand, the smelter more normal production during the Spring Festival, the downstream is in a holiday to reduce production, consumption is weak, inventory accumulation risk is greater; On the other hand, the US tariff policy was released, the trend of the US dollar index was strong, and the price of non-ferrous metals was under greater pressure. It is expected that the price trend of domestic non-ferrous metals would be weak after the Spring Festival. However, with the improvement of downstream consumption and optimistic domestic policy expectations, non-ferrous metal prices are expected to stabilize and rebound, and in the near future, continue to pay attention to varieties of inventory, to inventory, and macro policy changes at home and abroad.
