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Forecasts and market analysis based on price assessments from Fastmarkets MB and Fastmarkets AMM

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March 2017 | Base Metals


Copper: Key conference takeaways


In this week’s analysis, we give our view on the key takeaways from MB’s copper conference in Leipzig. Although much of the market’s day-to-day focus so far this year has been on mine supply disruptions, cathode is in a state of oversupply. But current deficit in the concentrate market will shift into the refined market as the year progresses. We still expect prices to trade sideways-to-lower in Q2 as many headwinds are battled though, but the uptrend should resume thereafter.

Overall the mood was fairly mixed at the conference, suggesting that despite the pick-up in prices over the last few months, the bull-bear battle still rages on. Below we pick out some of the key themes which were being discussed in Leipzig and provide our own view on them.

The refined market is in oversupply
Many observers cited the massive deliveries into LME warehouses as evidence that the refined market is currently oversupplied. It has capped prices and softened premiums. A lack of Chinese buying interest was often flagged up and imports were off by 15.7% y/y in Jan-Feb.

MBR’s view: As stated in last week’s report, MBR has been expecting a significant surplus during Q1 for some time now. The market is certainly in oversupply at present (most...

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