(Bloomberg) – Copper prices in China have barely budged since the central bank cut interest rates and the government announced 33 measures to save the economy from the clutches of its Covid Zero policy.

Given copper’s wide range of applications, from construction to white goods and renewable energy, it might seem odd that such a broad response from authorities hasn’t generated much excitement among buyers. However, it may be that much of the stimulus, particularly around the release of loans, has actually been skewed to heal Beijing’s self-inflicted wounds in the real estate sector.

And Chinese real estate demand is at a standstill. As lockdowns or the threat of them linger, buying a new home is probably the last thing on people’s minds.

Government efforts to stimulate the real estate market have become “oversaturated,” said Jia Zheng, a metals trader at Shanghai Dongwu Jiuying Investment Management Co. “There are not enough effective policies to support the real economy, including including infrastructure and manufacturing,” she said. . “Investors want to see stimulus in things like new energy and the transformation of heavy industry.”

Construction accounts for about 20% of China’s copper demand, according to UBS AG. The other big components are appliances at 18% – and the purchase of big-ticket consumer goods often accompanies the purchase of a home – and electrical infrastructure at 31%.

Events today

(All Beijing time unless otherwise specified.)

• Report and webinar by the IEA and Tsinghua University on the carbon market in China, 08:30 Paris
• Qingneng Hosts China LNG Prospect Webcast in 2022, 4:00 p.m.

Today’s chart

Brazil and China have signed an agreement establishing health guidelines on corn exports that will guarantee access to Brazilian grain, a move that could threaten US dominance in China’s corn market.

On the wire

• Chinese automaker Zhongnan warns of its ability to pay obligations due in June
• China EV Stocks ETF heading for best month since October: chart
• Peru’s Castillo and communities reach agreement on MMG’s Las Bambas
• China Guinea Reliance on bauxite grows despite possible export restriction

The week ahead

Thursday May 26

• Bloomberg China Economic Survey for May, 10:00 a.m.
• USDA Weekly Export Sales, 8:30 a.m. EST

Friday May 27

• China Industrial Earnings for April, 9:30 a.m.
• Weekly iron ore stocks in Chinese ports
• Shanghai Stock Exchange Weekly commodity inventory, ~3:30 p.m.

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