The current global economy has always been enveloped in the shadow of the European debt crisis. The heavily indebted country crisis has been frequent, economic data has been weak, the growth rate of the euro area has been in a state of malaise, and the pace of economic recovery in the United States has been slow, and its economic data has been mixed. Against the backdrop of the global economic turmoil, the demand in the Chinese market has always been difficult to be boosted. In order to avoid an accelerated decline in China's economic growth, the country has introduced a new round of stimulus policies to boost market demand and investor confidence and support the growth of copper consumption.

China's economic growth slows down, and copper-related companies are struggling to survive. As China's economic growth continues to decline, the real estate sector is restrained by macro-control, and domestic demand is shrinking. Under the current circumstances of weak market demand, copper-related companies have begun to face the test of survival. In order to further understand the status of the production and operation of the market copper enterprises, we conducted a major survey on copper companies such as Zhejiang and Jiangsu.

The results of the survey showed that the large, medium and small-sized copper companies have suffered from the shrinking demand for copper terminals. The volatility of copper prices has affected the number of orders, and the operating rate has seen a declining trend. In May, nearly 66% of copper belt companies' operating rate fell compared with that in April. The average decline rate was about 1/3, of which the severe operating rate fell by half, and the best one fell by about 10%. Mr. Zhang, a manufacturer of copper products in Zhejiang, stated to us: “The current business situation is very poor. In May, the order reduction amounted to about 40%, and the local copper belt makers completely suspended production between 40% and 50%. I was engaged in copper. With the industry in eight years since the most difficult one. "At the same time, the copper bar market appears to be "loose"; recent copper bar processing plant operating rate fell between 20% -30%, the market demand fell 10 %-20% or so. Among them, large enterprises have strong survivability, mostly relying on fixed order channels, while small and medium-sized enterprises have fewer orders and production faces difficulties, and some manufacturers have no choice but to stop production.

With the new round of stimulus measures, the growth of demand for light copper in the downstream related industries is inseparable from the consumption of the downstream industries. The government has recently introduced some related policies to stimulate consumption in industries such as automobiles and home appliances, and further expanded the pace of infrastructure investment. Under the pressure of continuous economic downturn, steady growth began to pay attention to industrial policies, and the downstream industrial chain will become the “main force” driving copper demand.

As the largest industry in China, the automobile industry plays a decisive role in the national economy and can drive the development of more than 100 related industries. In order to stimulate domestic demand, following the “home appliances to the countryside”, the country introduced a new round of “cars to the countryside” policy to promote automobile consumption. Morley said: "I don't worry about the so-called saying that there is no significant recovery in China's demand. As a simple example, it takes about 25 kilograms of copper per car, and China has a huge market for car consumption." In May, the production and sales of domestic automobiles increased significantly year-on-year, driving cumulative growth in both sales and sales, and the automotive industry showed signs of stabilization. While the auto industry is gradually becoming stable, a new round of stimulus measures will further boost its growth in production and sales, driving the growth in consumer demand for copper.

At the same time, the appliance industry will usher in a new dawn since the end of the trade-in program. On May 16, the state decided to arrange fiscal subsidies of RMB 26.5 billion to start promoting air conditioners, flat-panel TVs, refrigerators, washing machines, and water heaters that meet energy-saving standards. The promotion period is tentatively set for one year to make up for the policy emptiness after the “home appliances going to the countryside” has ended. This makes the household appliance industry's attention rise linearly. With the gradual increase of temperature, a new wave of home appliance consumption will come. The popularization of financial subsidy policies for energy-saving household appliances is expected to promote household consumption and increase sales performance, thereby stimulating the demand for copper materials.

In addition, this year marked a significant increase in infrastructure investment, and some expressway networks, airports, and rail transit projects have received centralized approval. In the current sluggish real estate sector, investment in infrastructure has become the core pillar of the environment with low investment in manufacturing. The strong support of the state for infrastructure construction will help to stimulate related industries in the downstream to be boosted and stimulate the demand of the copper consumer market. Previously, Yang Wenjun, a representative of Yunnan Copper Securities, also stated that with the acceleration of the country’s infrastructure construction, the active promotion of strategic emerging industries, and the continuous improvement of consumer policies, it will help to release domestic nonferrous metals, especially copper. Consumption potential.

Copper demand is expected to turn better, and European debt problems are still the key Wang Funan of the Fubao Copper Research Group believes that with the industry's new round of stimulus measures, copper consumption is expected to gradually improve in the third quarter. Yesterday, the Greek Parliament re-elected the New Party, and the possibility that Greece will withdraw from the “eurozone” in the short term is sharply reduced. The positive news is that the price of copper will provide a certain boost. However, with the successful Greek election, the debt problem in Europe cannot be solved fundamentally; recent heavy debt countries such as Spain and Italy have continued to climb their yields, and the euro zone is still in crisis. If the euro zone is still unable to introduce effective solutions, the copper price upside will continue to be limited by the European debt problem.