LONDON: Copper prices fell in London on Tuesday after a strong July, as weak data out of top consumer China indicated poor demand.
Three-month copper on the London Metal Exchange (LME) was down 0.7% to $8,769 per metric ton by 1005 GMT.
Copper, used in power and construction, rose by 6.2% in July on hopes that China would bring more measures to boost its economy. It was copper’s best monthly performance since January when hopes of a surge in demand were high following China’s removal of its COVID curbs. Other base metals rose in July as well.
“Everything is up strongly from a month ago, so there is a pull-back today to consolidate those gains,” said Dan Smith, head of research at Amalgamated Metal Trading.
“Prices, especially for copper, are still relatively high versus where they should be in terms of demand. The recent PMI data from Asia showed weakness in China, Japan and South Korea. Construction data out of China is still very poor, it is a reason to be cautious in terms of base metals.”
A firmer dollar index also pressured the market, making commodities priced in the U.S. currency more expensive for buyers using other currencies.
Copper gains on US inflation data
Also weighing on the market have been rising stocks in LME-registered warehouses. After arrivals of 5,825 metric tons, total copper stocks rose to 74,175 metric tons and on-warrant inventories reached a two-month high of 73,725, daily LME data showed on Tuesday.
Among other LME metals, aluminium was down 1.0% to $2,260.5, zinc fell 0.1% to $2,562.5, lead lost 0.1% to $2,146.5, and tin dropped 3.1% to $27,740.
Tin inventories in the LME system are at the highest since October 2020, while SHFE tin stockpiles are hovering near their highest since 2017.
Nickel rose 1.1% to $22,540 in a technical rebound after breaking above the 100-day moving average.
Comments
Comments are closed.