Global Copper Rod Prices Decline at the Start of September 2023 Amid Rising Inventory Level

The price of Copper Rod dampens in the global spot market as the inventory level hikes in the local and foreign exchange markets. Feedstock Copper prices have declined by 2.4% since the start of September across the globe. Meanwhile, the demand from the downstream housing sector from the Asian market remains on a lower edge. The European and US market trade dampens amid business and manufacturing activity weakens in the overall global market. The buyers place limited orders as the market sentiment gets bearish. The fuel price of crude oil decreases, implying a negative impact on the manufacturing rate of Copper Rods.

The supply of Copper Rods has increased as inventory levels rise worldwide. This happens due to the increased extraction rate of Copper from the major mineral extracting companies such as Chile, Brazil, and Australia. The miners across South African countries are now looking forward to buying Botswana's Khoemacau copper mine operations as it is Africa's biggest copper mine. The three major companies, Impala Platinum, Exxaro Resources, and Sibanye Stillwater, have been listed as major investors in the Botswana copper mine for expansion of Copper Rod manufacturing. The Khoemacau mine has been anticipated to be valued at between USD 1.5 billion and USD 2 billion, upon which a few mining industries from China have joined the bidding race as Zijin Mining Group Co., MMG Ltd. and Aluminium Corp. of China are offering a bid of up to USD 2 billion for the Khoemacau mine. These factors would increase the production rate of Copper Rods.

Furthermore, Copper Rod mining in Chile has been on a higher edge since the start of the third quarter of 2023. Codelco, a Chilean state-owned copper mining company, raised a bond offering of about USD 2 billion from the investment drive in New York the previous week. The company would provide a 10-year note for $1.3 billion with a yield of 5.966% and a 30-year note for $700 million with a yield of 6.331%. This was in anticipation of the rising demand for Copper Rods from the global construction and Power and Energy sector. Additionally, Anglo American, a multinational copper mining company, has recently received permits for resuming the USD 40 million mining operation of El-Salado's copper mine in Chile; in addition to that, the Zambian government had decided to hand over the disputed Konkola Copper Mines to Vedanta Resources, a major Indian Copper producing firm. These factors have boosted production output and increased inventories, resulting in a lower price of Copper Rods globally.

According to recent market updates, a major scam has come into view, considering the import of copper scrap and indicating a serious loss for European Copper Rod producers. Aurubis AG, Hamburg, a major supplier of non-ferrous products worldwide, has announced that some of their suppliers must have manipulated details and falsified their data about the scrap metal they provided as they observed a serious shortfall in inventories. The scam has cost Europe's top copper producer an estimated loss of at least USD 108 million. These factors have caused the declining price trend for the Copper Rod in the European and overseas Global markets.

The demand from the downstream construction and housing sector from the Chinese market remained on a lower edge. This created a pessimistic market sentiment among the global market players and provoked them to place minimal orders for Copper Rods in the domestic Chinese and overall global market. On the macroeconomic front, the US dollar Index rebounded, declining the purchasing activity across the global market. The upstream of Copper Rod fuel prices also dipped as the dollar got firm, with investors shrugged off jitters arising from supply cuts from Saudi Arabia and Russia. These factors provoked the mills to reduce their production cost and indicated a negative market sentiment for Copper Rods in the worldwide market.

According to ChemAnalyst, the price of Copper Rods is expected to recover as the demand from the power and energy sector is anticipated to boost amid rising demand for clean and renewable energy sources. The purchase rate will increase as the economic market is presumed to get stabilized as governments of major countries are implying new policies to uplift the Copper Rod market.