Usually we can’t make right judgment if we don’t know factors which influence an event. Copper is experiencing great change, which factors cause present situation?
Supply and demand is the key factor which influences the fluctuation of price. According to microeconomics, when the supply of one goods is more than demand, the price will drop, or the price will go up. Specifically speaking, we can analyze this factor from the following three factors: supply, demand and store.
Since 2000, the global copper concentrate productivity is about 13.5 million tons every year. Of them, South America occupies a half. According to the developing trend, South America still will be the main place of producing copper. So concerning about these main copper production areas will let us know the supply trend. At the same time, America, Western Europe, China and Japan are main areas of copper consumption. The economical situation of these countries also influences the change of price. Besides, store is another indicator showing the relationship between supply and demand.
Another important factor is economical situation. Futures price not only reflects the present supply and demand, but also the prediction for future. Therefore, only making analysis of the present supply and demand is not enough. We also should analyze the factors which influence the future supply and demand. When analyzing the short-term supply and demand of copper, the most important thing is grasping its demand trend.
Last but not least, production cost is also a basis of deciding the goods price. When the production cost is at a high level, the price will go up, or the situation will be different. Of course, there are other factors which I would like to introduce in the following article.
The drop of copper price is both a challenge and chance. The copper scrap price must be influenced by this trend and it is a good time to purchase copper scrap at a lower price. If you are in copper recycling, I believe you will have a good choice. Our copper cable granulator and wire stripping machine will be your reliable partner and good assistance.