Copper prices decline – Markets
LONDON: Copper prices eased on Monday as investors feared weaker-than-expected trade data from major Chinese consumers, showing lackluster demand.
China’s copper imports fell 8% in May from the previous month, as record prices further eroded buyer interest as overall export growth missed analysts’ forecasts.
“When we get data like this from China, it highlights the potential risk that their rapid growth rate will start to slow,” said Ole Hansen, head of commodities strategy at Saxo Bank in Copenhagen.
“It’s a market that has lost momentum and traders are reacting to that and reducing their exposure. I’m not saying the rally is over, but the market potentially needs a period of consolidation which could take it even lower.
Three-month copper on the London Metal Exchange was down 0.3% to $ 9,925 a tonne at 4:00 p.m. GMT after rising 1.7% on Friday.
LME copper has gained 27% so far this year, after declining from a record $ 10,747.50 reached last month, in part driven by optimism that a green revolution would boost demand for copper at from new uses, including electric vehicles.
Hansen said if prices continued their pullback, they would likely head towards the 50-day moving average around $ 9,655.
The net long position in copper on US exchange Comex has fallen 58% in the past four weeks to its lowest levels since June of last year, he added.
The closely watched Yangshan copper premium, paid on top of London prices for physical copper delivery to China, is at its lowest since 2016 at $ 28 per tonne.
LME lead was the only metal in positive territory, rising 1.2% to $ 2,161.50 a tonne after LME mandate stocks fell 16% to a three-month low of 65,050 tonnes, according to daily data from the LME.
Aluminum LME fell 1% to $ 2,430 per tonne, nickel fell 0.7% to $ 17,895, zinc fell 0.1% to $ 3,008.50 and tin slipped from 1.2% to $ 30,505.