Copper price to fall in the second half of 2024, Antaike says
July 31 (Reuters) -Copper prices are likely to fall in the second half of 2024 due to steady output and weak demand concerns, influential Chinese state-backed research house Antaike said on Wednesday.
Worries over global economic slowdown, steady refined copper output growth and expected interest rate cuts will pressure copper prices for the rest of 2024, Antaike analyst Li Zhimei said at a Beijing conference.
The next support level for copper is at $8,500 a metric ton on the London Metal Exchange (LME) CMCU3 and 68,900 yuan ($9,540.29) on the Shanghai Futures Exchange (SHFE) SCFcv1, failing which prices could fall to $8,000 and 64,900 yuan, Li said.
Antaike forecast China's refined copper demand growth to slow to 2.5% in 2024, from 5.3% last year, dragged down by construction sector weakness. Given poor first-half performance, actual demand could lag the current forecast, she added.
The global refined copper surplus is expected at 300,000 tons in 2024, slightly above last year, Li said, adding that the concentrate market will continue to be tight and likely see a shortfall of 200,000 tons this year.
TIN
Tin prices this year could jump by almost 25% annually to an average 268,000 yuan a ton on SHFE, backed by a deficit in China of 2,920 tons compared to a surplus of 14,262 tons last year, said Antaike analyst Guo Ning.
Tin demand growth is mainly driven by the solar and electric vehicles sectors, while consumption from the military sector also increased amid geopolitical uncertainty, Guo said, adding that demand from the artificial intelligence sector remained limited despite hype about its tin usage potential.
A sharp drop in tin ore imports from Myanmar into China since April caused by a mining ban in the Southeast Asian country contributed to supply tightness, she added.
ALUMINIUM AND ZINC
Aluminium prices on SHFE will likely rise about 9% this year on average to 19,900 yuan, said Antaike analyst Lang Shitong, adding that demand will pick up in the fourth quarter after a traditionally weak third quarter.
Demand for the light metal used in construction, transportation and packaging is likely to grow about 4% this year in China to 44.6 million tons, driven by exports, she said, with China and the United States restocking recently.
The last three months of the year will see hydropower-reliant aluminium producers in southwestern China cutting output during the dry season, Lang said.
The supply outlook for electrolytic aluminium in the next two years remains tight due to China's capacity ceiling of 45 million tons, as well as production cuts in southwestern China and sanctions on Russian metals, she added.
Meanwhile, zinc prices are expected to rise 10% this year from 2023, due to mine supply disruptions and a demand growth forecast of 2%, said Antaike analyst Zhang Zhiwei.
($1 = 7.2220 yuan)
Reporting by Siyi Liu in Beijing and Mai Nguyen in Hanoi; Editing by Shailesh Kuber
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