Group 1 - Recent fluctuations in copper prices have intensified compared to the second quarter, with two notable spikes in late June and late July driven by a weakening US dollar and inventory depletion in non-US regions, as well as domestic sentiment around "anti-involution" [1] - The recent rise in copper prices has been limited due to the upcoming tariff decision, with the market's concerns about economic prospects not escalating further during trade negotiations between the US and other countries [1][9] - The "anti-involution" sentiment has led to increased optimism in the industrial sector, but the actual impact on copper prices has been muted, primarily driven by emotional factors rather than substantial demand [2] Group 2 - The current tight supply of copper concentrate is expected to persist in the short term, with domestic smelters facing challenges due to low processing fees, although the production of refined copper has increased by 9.5% year-on-year [5][6] - The upcoming US tariffs on copper imports, potentially increasing from 25% to 50%, could significantly alter global copper trade dynamics, leading to increased inventories in non-US regions [8] - Recent trade negotiations between the US and other countries have alleviated some market concerns, with the IMF slightly raising global economic growth forecasts, particularly for China [9]

Core Insights - The report indicates a significant increase in domestic copper demand, with a cumulative year-on-year growth of 4% and a monthly growth of 18% in June, primarily due to a low base in June 2024 [1][4] - The analysis highlights concerns regarding the sustainability of demand in the second half of 2025, as there are fears of a decline in demand following a strong export push in the first half [2][4] Domestic Demand Analysis - Domestic copper demand shows clear seasonal characteristics, with a cumulative year-on-year growth of 12% in the first half of the year and a monthly growth of 21% in June due to a low base effect [4] - The actual domestic copper demand has a cumulative year-on-year growth of 4%, with a notable monthly increase of 18% in June, reflecting the impact of high copper prices in the previous year [4][5] - The seasonal demand is expected to remain strong in September and October 2025, indicating a continued presence of peak demand characteristics [5][6] International Demand Analysis - U.S. copper demand is supported by a significant increase in imports, particularly in electrical equipment, with a year-on-year growth of 33% in the first five months and a monthly growth of 62% in May [7][8] - The increase in U.S. apparent demand is attributed to the 232 tariffs, which have led to higher copper imports, while actual consumption also includes copper from imported products [8] - The overall demand in the U.S. is characterized by strong growth, with a cumulative year-on-year increase of 18% in actual demand for the first five months [8] Investment Outlook - The analysis suggests that the market may have overestimated the inventory demand in the U.S. while underestimating the growth in industrial demand, leading to an optimistic outlook for the copper sector [9]

Report Industry Investment Rating - Copper: Cautiously bullish [5] - Arbitrage: On hold [5] - Options: Short put @77,000 yuan/ton [5] Core Viewpoints - The domestic macro sentiment continues to recover, which is beneficial for the performance of risk assets. However, the US tariff policy may increase future uncertainties. The market has largely digested the potential 50% tariff on copper. Fundamentally, copper is currently in a weak supply - demand situation. The price is expected to have limited performance but also limited downside due to tight mine supply. The expected price range next week is 77,800 - 80,300 yuan/ton, and it is recommended to buy on dips for hedging [5]. Summary by Relevant Catalogs Market News and Key Data - **Spot Situation**: From July 26, 2025, the average price of SMM 1 electrolytic copper ranged from 79,450 yuan/ton to 79,795 yuan/ton, showing an upward trend. The SMM premium - discount quotation ranged from 125 yuan/ton to 240 yuan/ton, with a fluctuating downward trend. In terms of inventory, LME inventory increased by 0.63 million tons to 12.85 million tons, SHFE inventory decreased by 1.11 million tons to 7.34 million tons, domestic social inventory (excluding bonded areas) decreased by 0.44 million tons to 11.42 million tons, bonded area inventory increased by 0.34 million tons to 8.22 million tons, and Comex inventory increased by 0.58 million tons to 24.86 million tons [1]. Market Outlook - **Macro - aspect**: The Trump administration introduced a differential tariff plan, imposing 15% - 50% stepped tariffs on imported goods from many countries. There is a conflict between Fed Chairman Powell and President Trump, and the market has significant differences on the Fed's future interest - rate path. Domestically, the anti - involution action has increased market risk sentiment, benefiting non - ferrous metals to some extent [2]. - **Mine - end**: The copper concentrate spot market was quiet. Traders were waiting for September - loaded futures, and smelters received few copper concentrate quotes. A large mining company sold 20,000 tons of September - loaded standard ore at a low price of TC - 40 dollars/ton, and a trader sold 10,000 tons of July - loaded Grasberg ore at a high price of TC - 30 dollars/ton [2]. - **Mining Company Dynamics**: Teck Resources reduced its 2024 copper production target from 230,000 - 270,000 tons to 210,000 - 230,000 tons due to tailings storage issues at the Quebrada Blanca mine and approved a 2.1 - 2.4 billion Canadian dollar investment plan to extend the HVC mine's life. Newmont's Red Chris mine in Canada suspended operations after an accident. Some domestic large - scale mining enterprises also stopped production due to safety incidents [3]. - **Smelting and Import**: The Yangshan copper premium rose slightly. The average price of August QP bills of lading was 66.2 dollars/ton (up 1.2 dollars/week), and the average price of warehouse receipts was 49.2 dollars/ton (up 0.2 dollars/week). The import loss was about 800 yuan/ton [3]. - **Market Trading**: The market trading was light. Reasons include US tariff policies leading to a large number of July bills of lading being re - exported to Hawaii, reduced arrival expectations from an African smelter in August, and long - term orders being postponed to mid - to - late August. Although the export window opened briefly, weak downstream demand limited buying. The market is closely watching the progress of China - US and Chile - US tariff negotiations [4]. - **Consumption**: In the week of July 26, 2025, the operating rate of the refined copper rod industry dropped to 69.37%, a 4.85 - percentage - point decline. The copper cable industry's operating rate dropped to 70.83%, a 2.07 - percentage - point decline and a 15.28 - percentage - point year - on - year decline. SMM expects the operating rate to drop to 70.3% next week, with a 21.2 - percentage - point year - on - year decline [4]. Strategy - **Copper**: Cautiously bullish, with an expected price range of 77,800 - 80,300 yuan/ton next week. It is recommended to buy on dips for hedging [5]. - **Arbitrage**: On hold [5] - **Options**: Short put @77,000 yuan/ton [5]

1. Report Industry Investment Rating - The report does not explicitly mention an industry investment rating. 2. Core Viewpoints of the Report - Copper lacks a clear driving force, and its price fluctuates within the range of 77,000 - 80,000 yuan/ton, with a neutral strength analysis [3]. - Globally, the total copper inventory is decreasing, mainly due to a significant reduction in domestic social inventory. However, the domestic spot premium is falling, and the term structure continues to weaken. The approaching 50% tariff on copper in the US may lead to an increase in LME copper inventory and a weakening of the spot [8]. - There is uncertainty in the macro - environment, but there is support at the bottom. Trump's tariff policy may affect the global economy, while the Fed's potential future interest rate cuts may support the US economy [8]. - In terms of trading strategies, downstream buyers are cautious. With Trump's impending tariff increase on copper, unilateral trading should be cautious. For spread trading, as domestic inventory decreases, the spot premium may strengthen in the future, and term positive spreads can be tentatively traded [8]. 3. Summary by Relevant Catalogs 3.1 Trading End - **Volatility**: The volatility of copper in four markets has rebounded. The volatility of COMEX copper prices reaches around 33%, and that of SHFE copper prices is around 11% [12]. - **Term Spread**: The term B - structure of SHFE copper has weakened, and the LME copper spot discount is weak. The C - structure of COMEX copper has narrowed [15][16]. - **Position**: The positions of SHFE copper, LME copper, international copper, and COMEX copper have all increased. The position of SHFE copper has increased by 11,200 lots to 510,600 lots [17]. - **Fund and Industry Position**: The net long position of non - commercial traders in CFTC has decreased. The net short position of LME commercial traders has decreased from 64,900 lots to 61,000 lots, and the net long position of non - commercial traders in CFTC has decreased from 40,700 lots on July 15th to 39,800 lots on July 22nd [23]. - **Spot Premium**: The domestic copper spot premium has weakened. The Yangshan Port copper premium has rebounded, the US copper premium remains at a high level, the Rotterdam copper premium has declined, and the Southeast Asian copper premium has remained stable [27]. - **Inventory**: The global total copper inventory has decreased, with a significant reduction in social inventory. The bonded area inventory and COMEX inventory have increased, and the LME copper inventory has also increased [30][33]. - **Position - to - Inventory Ratio**: The position - to - inventory ratio of LME copper has declined, weakening the logic of overseas spot tightness. The position - to - inventory ratio of SHFE copper 08 contract is at a relatively high level in the same period of history [34]. 3.2 Supply End - **Copper Concentrate**: Copper concentrate imports have increased year - on - year. In June 2025, China's imports of copper ore and its concentrates were 2.3497 million tons, a year - on - year increase of 1.69%. The port inventory of copper concentrate has decreased, and the processing fee has marginally rebounded [37][40]. - **Recycled Copper**: The import of recycled copper has increased year - on - year, while the domestic production has decreased significantly. The refined - scrap spread of recycled copper has weakened, and the import loss has expanded [41][46]. - **Blister Copper**: The import of blister copper has increased. In June, the import was 68,500 tons, a year - on - year increase of 2.38%. The processing fee is at a low level [51]. - **Refined Copper**: The production of refined copper has increased more than expected, imports have increased, and copper exports are at a loss. In June, the production was 1.1349 million tons, a year - on - year increase of 12.93%, and imports were 300,500 tons, a year - on - year increase of 5.11% [54][55]. 3.3 Demand End - **开工率**: In June, the operating rate of copper product enterprises weakened month - on - month. The operating rate of copper tubes was at a historically low level in the same period, and that of copper plates, strips, and foils was at a relatively low - neutral level. The operating rate of wire and cable decreased in the week of July 24th [58]. - **Profit**: The processing fee of copper rods has rebounded but is at a relatively low level in the same period of history. The processing fee of copper tubes has rebounded, while the processing fees of copper plates, strips, and lithium - ion copper foils have weakened [61][63]. - **Raw Material Inventory**: The raw material inventory of wire and cable enterprises has remained at a low level. In June, the raw material inventory of copper rod enterprises was at a high level in the same period of history, and that of copper tubes was at a low level [64]. - **Finished Product Inventory**: The finished product inventory of copper rods has rebounded, and that of wire and cable has decreased. In June, the finished product inventory of copper rods was at a relatively high - neutral level in the same period of history, and that of copper tubes was at a relatively low - neutral level [67]. 3.4 Consumption End - **Apparent Consumption**: The domestic actual copper consumption has performed well. From January to June, the cumulative consumption was 7.8135 million tons, a year - on - year increase of 12.69%, and the apparent consumption was 7.822 million tons, a year - on - year increase of 5.46%. Grid investment, home appliances, and the new energy industry are important supports for copper consumption. Grid investment has accelerated, with a cumulative investment of 291.1 billion yuan from January to June, a year - on - year increase of 14.60% [72]. - **Air - Conditioner and New - Energy Vehicle Production**: In June, the domestic air - conditioner production was 18.782 million units, a year - on - year increase of 2.16%, and the domestic new - energy vehicle production was 1.268 million vehicles, a year - on - year increase of 26.42% [74].

Report Industry Investment Rating No relevant information provided. Core Viewpoints of the Report - The domestic downstream refined copper rod enterprises' operating rate declined, and the tight supply situation in the spot market has eased. The downstream mainly made rigid purchases, and the trading volume was average. The domestic refined - scrap copper price difference narrowed slightly, the supply of recycled raw materials remained tight, and the operating rate of recycled copper rod enterprises rebounded slightly [11]. - The spot processing fee of copper concentrate increased slightly, the processing fee of blister copper remained flat month - on - month, and the supply of cold materials was marginally stable. Teck Resources cut its copper production target for this year to 47 - 52.5 tons, with the average value 2 - 3 tons lower than the previous target [12]. - The total inventory of the three major exchanges increased by 0.4 tons month - on - month. The inventory of SHFE decreased by 1.1 to 7.3 tons, the inventory of LME increased by 0.6 to 12.9 tons, and the inventory of COMEX increased by 0.8 to 22.6 tons. The inventory in Shanghai Bonded Area increased by 0.2 tons. The spot premium in Shanghai was 125 yuan/ton over futures on Friday, and the LME market's Cash/3M was at a discount of 53.7 dollars/ton [12]. - The spot import loss of domestic electrolytic copper expanded slightly, and the Yangshan copper premium increased. In June 2025, China's refined copper imports were 33.7 tons, and the net imports were 25.8 tons, a year - on - year increase of 71.1%. From January to June, the cumulative imports were 188.6 tons, and the net imports were 158.4 tons, a year - on - year decrease of 2.3% [12]. - The basis of the domestic and foreign markets fluctuated weakly, the refined - scrap copper price difference narrowed, and the global visible inventory increased. The valuation of copper was neutral to bearish. In terms of drivers, the increase in copper concentrate processing fees had a neutral impact on copper prices, while the weakening of the US dollar index and the recovery of the global manufacturing PMI were bullish drivers. There were several major macro - events this week, including the Politburo meeting in China, the Fed's interest - rate meeting, and the implementation of US copper tariffs. If the tariffs are strictly enforced, they will put pressure on SHFE copper and LME copper. Industrially, the tight supply of copper raw materials remains, but due to the seasonal weakness in downstream demand and the expected increase in imports, the upward movement of copper prices is limited, and it is expected to be mainly volatile and weak [13]. Summary by Directory 1. Weekly Assessment and Strategy Recommendation - **Demand**: The operating rate of domestic downstream refined copper rod enterprises declined, and the tight supply in the spot market eased. The downstream mainly made rigid purchases. The domestic refined - scrap copper price difference narrowed slightly, the supply of recycled raw materials remained tight, and the operating rate of recycled copper rod enterprises rebounded slightly [11]. - **Supply**: The spot processing fee of copper concentrate increased slightly, the processing fee of blister copper remained flat month - on - month, and the supply of cold materials was marginally stable. Teck Resources cut its copper production target for this year [12]. - **Inventory**: The total inventory of the three major exchanges increased by 0.4 tons month - on - month. The inventory of SHFE decreased by 1.1 to 7.3 tons, the inventory of LME increased by 0.6 to 12.9 tons, and the inventory of COMEX increased by 0.8 to 22.6 tons. The inventory in Shanghai Bonded Area increased by 0.2 tons. The spot premium in Shanghai was 125 yuan/ton over futures on Friday, and the LME market's Cash/3M was at a discount of 53.7 dollars/ton [12]. - **Import and Export**: The spot import loss of domestic electrolytic copper expanded slightly, and the Yangshan copper premium increased. In June 2025, China's refined copper imports were 33.7 tons, and the net imports were 25.8 tons, a year - on - year increase of 71.1%. From January to June, the cumulative imports were 188.6 tons, and the net imports were 158.4 tons, a year - on - year decrease of 2.3% [12]. - **Fundamental Assessment**: The basis of the domestic and foreign markets fluctuated weakly, the refined - scrap copper price difference narrowed, and the global visible inventory increased. The valuation of copper was neutral to bearish. The increase in copper concentrate processing fees had a neutral impact on copper prices, while the weakening of the US dollar index and the recovery of the global manufacturing PMI were bullish drivers. There were several major macro - events this week, and if the US copper tariffs are strictly enforced, they will put pressure on SHFE copper and LME copper. The upward movement of copper prices is limited, and it is expected to be mainly volatile and weak [13]. 2. Futures and Spot Market - **Futures Price**: Copper prices rose first and then fell. The main contract of SHFE copper rose 1.07% this week (as of Friday's close), and LME copper rose 0.02% to 9796 dollars/ton [24]. - **Spot Price**: The spot prices of electrolytic copper, copper products, and recycled copper showed certain changes. For example, the Yangtze River Non - ferrous price of electrolytic copper was 79,580 yuan on July 25, 2025 [26]. - **Premium and Discount**: The domestic copper price rose first and then fell, and the basis quotation declined with the increase in supply. The spot in East China was at a premium of 125 yuan/ton over futures on Friday. The LME inventory continued to increase, the proportion of cancelled warrants increased, and the Cash/3M remained at a discount, reporting a discount of 53.7 dollars/ton on Friday. The domestic electrolytic copper spot import had a small loss last week, and the Yangshan copper premium (bill of lading) increased [29]. - **Structure**: The contango structure of SHFE copper's near - month contracts expanded slightly, and the contango structure of LME copper contracted slightly [32]. 3. Profit and Inventory - **Smelting Profit**: The spot rough - smelting fee (TC) of imported copper concentrate increased slightly to - 42.6 dollars/ton. The price of sulfuric acid in East China increased, which still had a positive impact on copper smelting revenue [37]. - **Import and Export Ratio**: No specific content provided. - **Import and Export Profit and Loss**: The spot import loss of copper expanded slightly [42]. - **Inventory**: The total inventory of the three major exchanges was 42.7 tons, an increase of 0.4 tons month - on - month. The inventory of SHFE decreased by 1.1 to 7.3 tons, the inventory of LME increased by 0.6 to 12.9 tons, and the inventory of COMEX increased by 0.8 to 22.6 tons. The inventory in Shanghai Bonded Area was 7.1 tons, an increase of 0.2 tons month - on - month. The decrease in SHFE inventory came from Jiangsu and Guangdong, and the inventory in Shanghai increased slightly. The number of copper warrants decreased by 22106 to 16133 tons. The increase in LME inventory came from Asian warehouses, and the proportion of cancelled warrants increased [45][48][51]. 4. Supply Side - **Monthly Output of Electrolytic Copper**: According to SMM's survey data, China's refined copper output declined slightly in June 2025, and it is expected to increase again in July. According to the National Bureau of Statistics, the domestic refined copper output in June 2025 was 130.2 tons, a year - on - year increase of 14.2%. From January to June, the cumulative output was 736.3 tons, a year - on - year increase of 9.5% [56]. - **Import and Export Situation**: In June 2025, China's copper ore imports were 235 tons, a slight decrease month - on - month and a year - on - year increase of 1.7%. From January to June, the cumulative imports were 1475.4 tons, a year - on - year increase of 6.4%. The imports of unforged copper and copper products were 46.4 tons, an increase of 3.9 tons month - on - month and a year - on - year increase of 6.4%. From January to June, the cumulative imports were 263.3 tons, a year - on - year decrease of 4.6%. The imports of anode copper in June were 6.9 tons, a year - on - year increase of 2.4%. From January to June, the cumulative imports were 38.3 tons, a year - on - year decrease of 17.6%. The refined copper imports in June were 33.7 tons, and the net imports were 25.8 tons, a year - on - year increase of 71.1%. From January to June, the cumulative imports were 188.6 tons, and the net imports were 158.4 tons, a year - on - year decrease of 2.3%. The exports of refined copper in June were 7.9 tons, an increase of 4.5 tons month - on - month. The imports of recycled copper in June were 18.3 tons, a slight decrease month - on - month and a year - on - year increase of 8.5%. From January to June, the cumulative imports were 114.5 tons, a year - on - year decrease of 0.5% [59][62][65][71][74]. 5. Demand Side - **Consumption Structure**: China's official and Caixin manufacturing PMIs both rebounded in June, with the Caixin manufacturing PMI returning above the boom - bust line, indicating an improvement in manufacturing sentiment. The manufacturing sentiment of major overseas economies improved steadily [81]. - **Downstream Industry Output Data**: In June, the year - on - year output growth was seen in industries such as automobiles, air conditioners, washing machines, freezers, refrigerators, AC motors, and power generation equipment. The output of power generation equipment continued to grow at a high rate, while the output of color TVs decreased year - on - year. From January to June, the cumulative year - on - year output growth was seen in power generation equipment, air conditioners, washing machines, refrigerators, and AC motors, while the cumulative output of color TVs and freezers decreased [84]. - **Real Estate Data**: The domestic real estate data remained weak from January to June. New construction, construction, sales, and completion all decreased year - on - year. The decline in sales and construction areas widened, while the decline in new construction and completion areas narrowed. The National Real Estate Climate Index continued to decline in June [87]. - **Downstream Enterprises' Operating Rate**: The operating rate of China's refined copper rod enterprises declined in June and is expected to continue to decline in July. The operating rate of scrap copper rod enterprises rebounded in June and is expected to decline in July. The operating rates of other downstream enterprises such as enameled wire, wire and cable, copper tube, and brass rod enterprises also showed different trends of decline or increase in June and corresponding expectations for July [90][93][96][99]. 6. Capital Side - **SHFE Copper Position**: The total position of SHFE copper increased by 22396 to 1021138 lots (bilateral), and the position of the near - month 2508 contract was 179194 lots (bilateral) [106]. - **Foreign Fund Position**: As of July 22, CFTC funds maintained a net long position, but the net long ratio declined to 13.5%. The increase in short - positions was slightly greater than that in long - positions. The proportion of long - positions of LME investment funds declined (as of July 18) [109].

Report Summary 1. Report Industry Investment Rating No relevant information provided. 2. Core Viewpoints of the Report - The anti - involution trend affects the entire non - ferrous metal sector. The rise in non - ferrous metals is likely due to demand - side factors rather than issues with the US dollar index, gold, or supply. The development of high - quality projects and the Yarlung Zangbo River Hydropower Station may have a significant impact on copper and zinc. Copper may be slightly stronger in the short term, but there are potential mid - term risks as the price increase has not significantly driven up positions, and there is no need for large - scale capacity optimization on the supply side [3]. - There are both利多 and利空 factors for copper. The利多 factors include the easing of Sino - US tariff policies, the reduction of LME inventory levels, the low - level hovering of the US dollar index, and the positive impact of anti - involution on the non - ferrous metal sector. The利空 factors are the uncertainty of tariff policies, the potential reduction of global demand due to tariff policies, and the Fed's maintenance of high interest rates [4][5][7]. 3. Summary by Relevant Catalogs Copper Price and Volatility - The latest copper price is 79,590 yuan/ton, with a monthly price range forecast of 73,000 - 80,000 yuan/ton. The current volatility is 11.64%, and the historical percentile of the current volatility is 22.6% [2]. Copper Risk Management Suggestions - **Inventory Management**: For high finished - product inventory and fear of price decline, it is recommended to sell 75% of the Shanghai Copper main futures contract at around 82,000 yuan/ton and sell 25% of the CU2509C82000 call option when volatility is relatively stable [2]. - **Raw Material Management**: For low raw - material inventory and fear of price increase, it is recommended to buy 75% of the Shanghai Copper main futures contract at around 75,000 yuan/ton [2]. Copper Futures and Spot Data - **Futures Data**: The latest price of the Shanghai Copper main contract is 79,590 yuan/ton with no daily change. The Shanghai Copper continuous - one contract is 79,590 yuan/ton, down 150 yuan (- 0.19%); the Shanghai Copper continuous - three contract is 79,560 yuan/ton with no change; the LME 3M copper is 9,933.5 US dollars/ton, up 35.5 US dollars (0.36%); the Shanghai - London ratio is 8.14, up 0.01 (0.12%) [6][8]. - **Spot Data**: The latest prices of Shanghai Non - ferrous 1 copper, Shanghai Wumaotrade, Guangdong Southern Reserve, and Yangtze Non - ferrous are 79,790 yuan/ton, 79,875 yuan/ton, 79,630 yuan/ton, and 79,940 yuan/ton respectively, with daily changes of 35 yuan (0.04%), 170 yuan (0.21%), 120 yuan (0.15%), and 110 yuan (0.14%) [10]. Copper Inventory Data - **Shanghai Futures Exchange (SHFE)**: The total Shanghai Copper warehouse receipts are 15,535 tons, down 9,972 tons (- 39.1%); the total international copper warehouse receipts are 4,667 tons with no change [15]. - **LME**: The total LME copper inventory is 124,825 tons, down 25 tons (- 0.02%); European inventory is 28,775 tons, down 475 tons (- 1.62%); Asian inventory is 13,150 tons, down 82,925 tons (- 86.31%); North American inventory is 0 tons [17]. - **COMEX**: The total COMEX copper inventory is 245,508 tons, up 6,073 tons (2.54%) [20]. Copper Import and Processing Data - The copper import profit and loss is - 247.47 yuan/ton, down 285.72 yuan (- 746.98%); the copper concentrate TC is - 42.9 US dollars/ton, up 0.27 US dollars (- 0.63%) [21].

1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - Trump announced a 50% tariff increase on copper on July 9, 2025, and stated on social media on July 10 that the 232 tariff would take effect on August 1. The specific details are still unclear, and the main purpose is to reduce external dependence and promote the reshoring of the manufacturing industry [2]. - The core contradiction in the US copper industry is insufficient smelting capacity rather than resource shortage, resulting in a trade pattern of "raw material export - finished product import." In 2025, from January to July, US refined copper imports may exceed 1 million tons, and even if imports stop within the year, normal supply can still be maintained. It is expected that refined copper exports to the US will decrease significantly in the second half of the year, and the supply of refined copper in non - US regions is expected to increase, but the overall inventory accumulation speed may be lower than expected. Next year, regardless of whether the tariff is exempted, US refined copper imports will return to normal levels. If copper product enterprises reshore, the US will increase refined copper imports to replace imported copper products [2]. - The reshoring cycle of copper smelting is relatively long and currently faces a series of problems. In contrast, the construction cycle of copper products is short, and scrap copper supply is sufficient, making reshoring easier. If considering pre - preparation issues such as labor, environmental protection, and documents, referring to the import and export situation of aluminum products, the production cycle may be about 2 years [3]. - If there is no 232 exemption, the comex - lme spread will rebound to over 40%, most affecting Chile and Canada. If the US exempts the 232 tariff for Chile, Canada and other countries, it may cause a short - term plunge in comex copper, and the comex - lme spread will drop to 0 - 10%. If non - major import source countries are exempted, the impact on the market is small, and the spread may remain at 30% - 40%. If major import source countries are exempted from the refined copper tariff and instead restrict the export of scrap copper and copper concentrate, it will drive the comex - lme spread to decline, exacerbate the global shortage of raw material supply, and copper prices may start a new round of upward trend [3][5]. 3. Summary According to Relevant Catalogs 3.1 US Copper Industry Structure - The main contradiction in the US copper industry is not the shortage of copper element supply but the regression of smelting capacity. Comparing 1998 (the year with the highest electrolytic copper production) and 2024, in 1998, US copper concentrate production was 1.86 million tons, copper self - sufficiency rate was as high as 87%, net imported copper concentrate was 180,000 tons, and 350,000 tons of scrap copper were imported as raw material supplements. Electrolytic copper production reached a peak of 2.14 million tons, accounting for 17.63% of the global total, but still could not meet domestic demand of 2.89 million tons, with a net import of 640,000 tons of refined copper. In 2024, US copper concentrate production decreased to 1.1 million tons, of which 780,000 tons were used for domestic smelter production, and the remaining 320,000 tons were exported. The US changed from a net importer of scrap copper to the largest exporter, with a net export volume of 820,000 tons. Refined copper production decreased to 850,000 tons, a 60% reduction compared to 1998. Net imports increased to 724,000 tons, and consumption decreased from 2.89 million tons in 1998 to 1.6 million tons in 2024 [7]. 3.2 US Copper Trade Flows 3.2.1 Copper Concentrate - In 2024, US copper concentrate production was 1.1 million tons, and 320,000 tons were exported, mainly to Mexico, China, and Canada. Exports to Mexico were 229,000 tons, accounting for 71.6%. The US basically does not import copper concentrate and is less affected by the 232 tariff [16]. 3.2.2 Scrap Copper - In 2024, the US exported 959,000 tons of scrap copper, with 397,000 tons (or 40%) exported to China, 104,000 tons to Canada, 95,000 tons to Thailand, 74,000 tons to India, and 72,000 tons to Malaysia. After the mutual addition of 10% reciprocal tariffs between China and the US, the export volume of scrap copper in April and May did not decrease, but the export destination changed. Thailand and India became the top two importers. In 2024, the US imported 138,000 tons of scrap copper, mainly from Mexico and Canada. If Trump imposes a 232 tariff on scrap copper, Mexican scrap copper may be redirected to other countries. There are three possible future directions for US scrap copper: normal export, entering the processing link if the copper processing industry reshore, and entering the smelting link if the copper smelting industry reshore. It is considered that the second possibility is more likely [19][20]. 3.2.3 Electrolytic Copper - In 2024, the US imported 926,000 tons of refined copper, with the top three import source countries being Chile, Canada, and Peru, with import volumes of 650,000 tons (or 70%), 154,000 tons (or 16.6%), and 63,000 tons (or 6.8%) respectively. In 2025, affected by the 232 tariff policy, from January to May, the US imported 680,000 tons of refined copper. Assuming an average import of 200,000 tons in June and July, the total import volume will reach 1.08 million tons, exceeding the annual import volume in previous years. Import volume will decrease significantly or stop within the year, and refined copper from Chile, Canada, and Peru may be shipped to non - US regions. In 2024, the US exported 202,000 tons of refined copper, with 157,000 tons (or 77.7%) exported to Mexico and 24,000 tons (or 11.9%) to Canada [22]. 3.2.4 Copper Products and Others - In 2024, the total import volume of US copper products was 578,000 tons, and the total export volume was 272,000 tons. Import sources were relatively scattered, while exports were concentrated in Canada and Mexico. For copper rods and profiles, 55,000 tons were imported, mainly from Germany, Peru, and Mexico, and 29,000 tons were exported, with Canada and Mexico accounting for 44% and 40% respectively. The most imported copper product was copper wire, with 255,000 tons imported in 2024, of which Canada accounted for about 77.6% of exports to the US. The US also exported 171,000 tons of copper wire, mainly to Mexico and Canada. For copper plates and strips, 84,000 tons were imported, and 36,000 tons were exported, mainly to Mexico and Canada. The US imported 31,000 tons of copper foil, mainly from Asian countries and regions, and basically had no exports. Copper tubes had the highest net import volume, with 103,000 tons imported in 2024 and 25,000 tons exported, mainly to Mexico, Saudi Arabia, and Canada. In 2024, the US imported 50,000 tons of copper tube accessories, mainly from China, Germany, and Vietnam, and exported 11,000 tons, mainly to Mexico and Canada [30][31].

Report Industry Investment Rating - Not provided Core View of the Report - The main contract of Shanghai copper fluctuates strongly, with increasing positions, spot premium, and strengthening basis. The fundamentals show that the TC spot index of copper concentrate has slightly rebounded but still operates in the negative range, and port inventories have slightly increased. Recently, the decline in copper prices has dragged down the quotation of copper ore slightly. On the supply side, due to the relatively abundant raw materials recently and the good price of by - product sulfuric acid from smelters, smelters' production willingness remains relatively positive, and the domestic supply volume may increase steadily and slightly. On the demand side, affected by the seasonal consumption off - season, the start - up and orders of downstream copper processing enterprises have declined. Coupled with the price - holding behavior of holders, downstream purchasing attitudes are cautious, mainly for just - in - time replenishment, so the trading sentiment in the spot market is relatively light. In terms of inventory, domestic social inventories have slightly accumulated but still operate at a medium - low level. Overall, the fundamentals of Shanghai copper may be in a situation of slightly increasing supply and temporarily weak demand, but due to the increasing macro - policy benefits, the industry expectations are gradually being repaired. In the options market, the call - put ratio of at - the - money option positions is 1.53, with a month - on - month decrease of 0.1204, indicating a bullish sentiment in the options market, and the implied volatility has slightly increased. Technically, for the 60 - minute MACD, the double lines are above the 0 - axis, and the red bars are converging. The operation suggestion is to conduct light - position oscillating trading and pay attention to controlling the rhythm and trading risks [2]. Summary by Relevant Catalogs Futures Market - The closing price of the main futures contract of Shanghai copper is 79,740 yuan/ton, up 40 yuan; the price of LME 3 - month copper is 9,849 dollars/ton, down 11 dollars. The inter - month spread of the main contract is - 30 yuan/ton, down 30 yuan; the position of the main contract of Shanghai copper is 166,726 lots, up 29,109 lots. The position of the top 20 futures holders of Shanghai copper is 1,583 lots, up 2,935 lots. LME copper inventory is 122,075 tons, down 100 tons; Shanghai Futures Exchange inventory of cathode copper is 84,556 tons, up 3,094 tons; LME copper cancelled warrants are 12,575 tons, down 1,500 tons; Shanghai Futures Exchange warehouse receipts of cathode copper are 25,507 tons, down 2,856 tons [2]. Spot Market - The price of SMM 1 copper spot is 79,755 yuan/ton, up 200 yuan; the price of Yangtze River Non - ferrous Market 1 copper spot is 79,695 yuan/ton, up 55 yuan. The CIF (bill of lading) price of Shanghai electrolytic copper is 65 dollars/ton, unchanged; the average premium of Yangshan copper is 48.5 dollars/ton, unchanged. The basis of the CU main contract is 15 yuan/ton, up 160 yuan; the LME copper premium (0 - 3) is - 66.96 dollars/ton, down 13.2 dollars [2]. Upstream Situation - The import volume of copper ore and concentrates is 234.97 million tons, down 4.58 million tons. The TC of domestic copper smelters is - 43.45 dollars/kiloton, up 0.34 dollars. The price of copper concentrate in Jiangxi is 70,030 yuan/metal ton, up 70 yuan; the price of copper concentrate in Yunnan is 70,730 yuan/metal ton, up 70 yuan. The processing fee of blister copper in the south is 800 yuan/ton, unchanged; the processing fee of blister copper in the north is 750 yuan/ton, unchanged [2]. Industry Situation - The output of refined copper is 130.2 million tons, up 4.8 million tons. The import volume of unwrought copper and copper products is 460,000 tons, up 30,000 tons. The social inventory of copper is 41.82 million tons, up 0.43 million tons. The price of 1 bright copper wire scrap in Shanghai is 55,690 yuan/ton, up 600 yuan; the price of 2 copper scrap (94 - 96%) in Shanghai is 68,100 yuan/ton, up 800 yuan. The ex - factory price of 98% sulfuric acid of Jiangxi Copper is 640 yuan/ton, unchanged [2]. Downstream and Application - The output of copper products is 221.45 million tons, up 11.85 million tons. The cumulative completed investment in power grid infrastructure is 203.986 billion yuan, up 63.169 billion yuan. The cumulative completed investment in real estate development is 4,665.756 billion yuan, up 1,042.372 billion yuan. The monthly output of integrated circuits is 4,505,785,400 pieces, up 270,785,400 pieces [2]. Option Situation - The 20 - day historical volatility of Shanghai copper is 11.57%, down 0.08%; the 40 - day historical volatility of Shanghai copper is 10.02%, down 0.10%. The implied volatility of at - the - money options in the current month is 12.4%, up 0.0291; the call - put ratio of at - the - money options is 1.53, down 0.1204 [2]. Industry News - In the first half of 2025, the national economy generally operated steadily and improved. The more proactive fiscal policy has achieved remarkable results. In the second half of the year, to promote consumption and investment, the fiscal policy will continue to act proactively. The LPR in China remained unchanged in July for the second consecutive month, with the 1 - year variety at 3.0% and the over - 5 - year variety at 3.5%. Market institutions generally expect that there is room for further decline in LPR in the second half of the year. International rating agency Fitch said that policy risks cast a shadow over the US credit outlook. Fitch downgraded the outlook of 25% of US industries in 2025 to "deteriorating" due to increased uncertainty, slow economic growth, and the expectation of long - term high interest rates [2].

Group 1: Report Industry Investment Rating - Copper investment rating: Cautiously bullish [6] - Arbitrage investment rating: Suspended [6] - Option strategy: Short put @ 77,000 yuan/ton [6] Group 2: Core View of the Report - The decline of LME and SHFE copper was due to the increase in LME inventory caused by Trump's plan to impose a 50% tariff on copper from August 1st, but the supply - demand of copper has not changed fundamentally. With low TC prices and no significant weakening of terminal consumption, it is recommended to buy on dips for hedging [6] Group 3: Summary by Related Catalogs Market News and Important Data Futures Quotes - On July 21, 2025, the SHFE copper main contract opened at 78,500 yuan/ton and closed at 79,700 yuan/ton, up 1.65% from the previous trading day. The night - session closed at 79,770 yuan/ton, up 0.64% from the afternoon close [1] Spot Situation - SMM1 electrolytic copper was quoted at 79,320 - 79,790 yuan/ton, with a premium of 150 - 290 yuan/ton to the current contract. The average premium rose 45 yuan from the previous day. The market showed three characteristics, and short - term spot premiums are expected to remain firm [2] Important Information Summary - **Macro and Geopolitical**: US Treasury Secretary said to cut interest rates if inflation is low. Trump Media & Technology Group bought $2 billion in Bitcoin. The US and Germany are close to an agreement to provide air - defense systems to Ukraine [3] - **Mine End**: In June 2025, China's copper ore and concentrate imports were 2,349,690.57 tons, down 1.91% month - on - month and up 1.77% year - on - year. Imports from Chile and Peru changed differently [3] - **Smelting and Import**: In June 2025, China's refined copper imports were 337,042.568 tons, up 15.15% month - on - month and 9.23% year - on - year. Imports from the DRC and Russia changed differently [4] - **Consumption**: On July 18, the copper rod order volume was 0.97 tons, down 0.10 tons from the previous day. The refined copper rod order volume and weekly total transactions also decreased [4] - **Inventory and Warehouse Receipts**: LME warehouse receipts changed by 25.00 tons to 122,075 tons, SHFE warehouse receipts changed by - 10,062 tons to 28,177 tons, and domestic spot electrolytic copper inventory decreased by 2.47 tons to 11.86 tons [5] Strategy - Copper: It is recommended to buy on dips for hedging [6] - Arbitrage: Suspended [6] - Option: Short put @ 77,000 yuan/ton [6] Table 1: Copper Price and Basis Data - The table shows the changes in copper prices, premiums, inventories, warehouse receipts, arbitrage spreads, import profits, and the SHFE - LME ratio over different time periods [24][25][26]

Report Summary 1. Report Industry Investment Rating No information provided. 2. Core Viewpoint - The positive macro - expectations brought by anti - involution have pushed up short - term copper prices [3]. 3. Summary by Relevant Catalogs 3.1 Copper Price and Volatility - The latest copper price is 79,700 yuan/ton, with a monthly price range forecast of 73,000 - 80,000 yuan/ton. The current volatility is 11.70%, and the historical percentile of the current volatility is 23.0% [2]. 3.2 Copper Risk Management Suggestions - **Inventory Management**: For high finished - product inventory and fear of price decline, it is recommended to sell 75% of the Shanghai copper main futures contract at around 82,000 yuan/ton and sell 25% of the CU2509C82000 call option when the volatility is relatively stable [2]. - **Raw Material Management**: For low raw - material inventory and fear of price increase, it is recommended to buy 75% of the Shanghai copper main futures contract at around 75,000 yuan/ton [2]. 3.3 Factors Affecting Copper Prices - **Likely Factors**: Sino - US tariff policy easing, lower LME inventory levels, the US dollar index hovering at a low level, and anti - involution benefiting the entire non - ferrous metal sector [4]. - **Negative Factors**: Tariff policy fluctuations, reduced global demand due to tariff policies, and the Fed maintaining high interest rates [5]. 3.4 Nanhua's View on Copper Price Trends - Anti - involution affects the entire non - ferrous metal sector. Copper may be slightly stronger in the short term, but there are hidden risks in the medium - term rise. The increase in copper prices has not significantly driven up positions, and there is no need for large - scale capacity optimization on the supply side [6]. 3.5 Copper Futures and Spot Data - **Futures Data**: The latest price of the Shanghai copper main contract is 79,700 yuan/ton (unchanged), the Shanghai copper continuous - one contract is 79,770 yuan/ton (up 1,330 yuan, 1.7%), the Shanghai copper continuous - three contract is 79,750 yuan/ton (unchanged), the LME copper 3M is 9,794.5 US dollars/ton (up 116.5 US dollars, 1.2%), and the Shanghai - London ratio is 8.15 (down 0.03, - 0.37%) [7]. - **Spot Data**: The prices of various copper spots have increased. For example, Shanghai Non - Ferrous 1 copper is 79,555 yuan/ton (up 895 yuan, 1.14%), and the price increases of other spots range from 0.71% to 1.33%. The spot premiums have also increased, with the increase ranging from 9.09% to 35.29% [10]. 3.6 Copper Scrap Spread and Warehouse Receipts - **Scrap Spread**: The current scrap spread (tax - included) is 1,478.51 yuan/ton (up 513.08 yuan, 53.15%), and the reasonable scrap spread (tax - included) is 1,496.7 yuan/ton (up 10.45 yuan, 0.7%) [13]. - **Warehouse Receipts**: The Shanghai copper warehouse receipts and international copper warehouse receipts have decreased. For example, the total Shanghai copper warehouse receipts are 38,239 tons (down 3,900 tons, - 9.26%), and the total international copper warehouse receipts are 4,667 tons (down 2,708 tons, - 36.72%) [16]. 3.7 Copper Inventory Data - **LME Inventory**: The total LME copper inventory is 122,075 tons (down 100 tons, - 0.08%), with different changes in different regions. The registered warehouse receipts are 108,100 tons (down 2,850 tons, - 2.57%), and the cancelled warehouse receipts are 14,075 tons (up 2,875 tons, 25.67%) [18]. - **COMEX Inventory**: The total COMEX copper inventory is 242,837 tons (up 8,633 tons, 3.69%) [21]. 3.8 Copper Import and Processing Data - The copper import profit is - 127.28 yuan/ton (down 16.74 yuan, - 11.62%), and the copper concentrate TC is - 43.17 US dollars/ton (unchanged) [22].