SCC(US:SCCO) Zhong Hang Qi Huo·2026-01-30 12:58Report Industry Investment Rating - Not provided in the content Core Viewpoints - In January 2026, copper prices showed significant volatility and a generally strong performance. The price increase was driven by multiple factors including macro - liquidity expectations, supply constraints at the mine end, and positive future demand prospects. The market has entered a stage dominated by strong expectations. However, the risk of overheating in the market is accumulating, and sharp fluctuations due to a rapid reversal of sentiment should be highly vigilant. It is recommended to take a bullish approach on dips [7][8]. Summary by Directory 1. Market Review - In January, copper prices were generally strong. At the beginning of the month, prices rose rapidly, reaching 105,320 yuan on January 6th, then entered a high - level consolidation phase. On January 23rd, the upward trend resumed, and on January 29th, the main contract of Shanghai copper (2603) once broke through the 110,000 yuan/ton mark [9][10]. 2. Macro - economic Analysis 2.1 United States - The US economic data is mixed. In December 2025, the seasonally - adjusted non - farm payrolls increased by 50,000, lower than the expected 60,000 and the previous value of 64,000. The unemployment rate in December was 4.4%, slightly lower than the market expectation of 4.5%. The third - quarter GDP in 2025 had an annualized quarter - on - quarter growth of 4.4%, higher than the initial value. The core PCE price index in November increased by 2.8% year - on - year and 0.2% month - on - month, both in line with expectations. The number of initial jobless claims last week was 200,000, lower than the expected 210,000 [13]. - The Federal Reserve kept the benchmark interest rate unchanged at 3.50% - 3.75%. After three consecutive 25 - basis - point interest rate cuts, it paused its actions, which was in line with market expectations. Fed Chair Powell's term ends on May 15th, and the new chair is expected to be either Reed or Walsh. It is anticipated that they will follow Trump's idea of significant monetary easing and continuous interest rate cuts, and another interest rate cut cycle may come in the second half of 2026, which may drive a new round of increases in non - ferrous metals [13]. - Since the New Year's Day, frequent geopolitical events led by the US, such as military actions against Venezuela, tense situation in Iran, and the Greenland issue, have reduced market risk appetite and exerted downward pressure on copper prices. These events have entered a more complex stage, and the future US national security strategy may lead to more geopolitical contradictions and risks [15][16]. 2.2 China - China's central bank maintained the one - year and five - year loan prime rates (LPR) at 3% and 3.5% respectively for eight consecutive months. In 2025, China's GDP increased by 5% year - on - year, reaching 140.19 trillion yuan. The central bank governor stated that in 2026, China would continue to implement a moderately loose monetary policy, with room for reserve requirement ratio cuts and interest rate cuts. The first batch of 936 billion yuan in ultra - long - term special treasury bonds has been issued to support equipment renewal projects, which are expected to drive total investment of over 4600 billion yuan [20]. 3. Fundamental Analysis 3.1 Supply - At the beginning of 2026, the global copper mine supply remained fragile. Labor disputes at the Mantoverde copper - gold mine in northern Chile have not been fully resolved, and Southern Copper has lowered its 2026 production target due to declining ore grades in Peruvian mines. In addition, the supply chain in some African regions has been affected by geopolitical situations, and the output of large mines such as Grasberg in Indonesia is still restricted by previous accidents. These factors have strengthened the market's long - term expectation of tight raw material supply [22]. - As of January 28th, the spot processing fee for copper concentrates was - 50.2 US dollars/ton, remaining in a deep negative range. The China Smelters Purchase Team (CSPT) has effectively abandoned the quarterly guidance price setting, reflecting the extreme shortage of copper concentrate supply. The extremely low processing fees are driving substantial adjustments in the industry, with major smelting enterprises' joint production cuts moving from proposals to implementation. The supply of scrap copper is also temporarily tight due to import policy and tax adjustments, which has further exacerbated the structural pressure on raw material sources at the smelting end [25]. 3.2 Inventory - Domestic copper inventories have been continuously increasing, and COMEX copper inventories have also been piling up. As of January 23rd, the copper inventory on the Shanghai Futures Exchange was 225,900 tons, with a cumulative increase of over 50% since the beginning of the year. As of January 28th, the COMEX copper inventory was 572,300 tons, still at a historical high. The domestic social inventory is at a high level, indicating that downstream acceptance of high copper prices is limited [28]. 3.3 Production - In December 2025, China's refined copper (electrolytic copper) production was 1.326 million tons, a year - on - year increase of 9.1%. The cumulative production from January to December was 14.72 million tons, a year - on - year increase of 10.4%. In January 2026, 5 smelters had maintenance plans, involving a rough - smelting capacity of 1.05 million tons, with an expected impact of about 19,000 tons. Only one of the two smelters originally planned to start production in January was able to do so on time, and the other was postponed to the end of March or early April [31]. 3.4 Import - In December 2025, China's scrap copper imports were 239,000 tons, a month - on - month increase of 14.81% and a year - on - year increase of 9.90%, reaching a new monthly high for the year. Asian countries remained the main suppliers, with Japan still at the top, Thailand's supply increasing month - on - month, and South Korea's supply decreasing significantly. Smelters have strengthened their procurement of scrap copper due to the tight supply of copper mines [34]. 3.5 Downstream Consumption - In December 2025, the production of domestic refined copper rods was 687,400 tons, a month - on - month decrease of 16.61%. The production capacity utilization rate was 51.10%, a month - on - month decrease of 12.22% and a year - on - year decrease of 15.06%. In January 2026, the production of refined copper rods was expected to be 755,900 tons, a month - on - month increase of 9.97%. The production capacity utilization rate was 53.97%, a month - on - month increase of 2.88% and a year - on - year increase of 5.46%. However, due to the extreme copper price movement in January, the overall increase in production was limited [39]. - In 2025, China's automobile production and sales both exceeded 34 million units, reaching a new historical high. New energy vehicle production and sales both exceeded 16 million units, accounting for over 50% of domestic new car sales. In December 2025, the newly - installed photovoltaic capacity decreased significantly, with a year - on - year decrease of 43.3% [46].