First Quarter of 2023 in North America Copper Rod Prices

North America

In the first quarter of 2023, the US market experienced a rise in Copper Rod prices due to the banking meltdown’s impact on high inflation and high-interest rates. Market players had noted that lower copper prices led to increased market demand ahead of traditionally high-demand months, such as April and May. As market participants looked for signs of a solid post-pandemic recovery, a slowdown in inventory build-up had indicated a rise in demand, and lead times had also been reduced due to lower input demand and fewer logistical delays. This improvement was driven by a sharp drop in input purchasing by manufacturers. Firms had chosen to deplete inventories as stocks of purchased and finished goods contracted. Additionally, the failure of Silicon Valley Bank in mid-March had a modest impact. The US dollar had also risen against most major currencies, reversing recent losses. The market’s preference for safe-haven assets had remained high due to continuing concerns about banking industry risks. Downstream businesses had taken a wait-and-see approach in the face of high copper prices. As a ripple effect, the Copper Rod (C110-1 inch) prices for Ex Alabama (USA) settled at USD 15698/MT.

Asia Pacific

In the first quarter of 2023, Copper Rod prices in the Chinese market increased due to a surge in Copper futures and limited global copper stocks. Initially, Copper prices began positively with the return of funds in anticipation of China’s exit from a year of lockdowns. However, the Spring Festival holiday in January, coupled with off-season consumption, caused downstream replenishment to remain weak, and spot market transactions were scarce. As Q1 progressed, demand rose as terminals, processing plants, and downstream businesses resumed production, and orders for Copper Rods increased. The sellers prioritized the delivery of long-term orders, and downstream companies took a wait-and-see approach in the face of high Copper Wire Prices. With the Chinese economy improving steadily, downstream demand is gradually improving as well. Overseas availability remains limited, which supports copper prices. As a ripple effect, the Copper Rod (20 mm) prices for Ex Shanghai and FOB Shanghai were fixed at USD 7300/MT and USD 7346/MT at the end of the first quarter of 2023.

Europe

Throughout the first quarter of 2023, the Copper Rod prices in the US market rose owing to the uptick in the downstream construction and machinery inquiries amidst banking sector turmoil. Buyers chose long-term contracts, avoiding the spot market. Potential supply disruptions from protests in Peru and a planned Utah smelter outage were noted but delayed shipments from Peru and Chile led to increased interest in copper scrap, and US premiums remained stable. Silicon Valley Bank’s failure had little impact, and the US Fed’s interest rate hike had little influence. Traders dominated spot market trades, and downstream buyers restocked as needed. Sellers prioritized long-term purchases, and import losses increased, reducing the possibility of significant inflows of imported goods. High copper prices kept buyers cautious, and trading was sluggish, with Copper Rod (25mm) prices for Ex Berleburg and FOB Hamburg fixed at USD 11708/MT and USD 11769/MT at the quarter’s end.

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