US copper futures lost more than 2 percent of their value early on Tuesday, with uncertainties surrounding the economic outlook in the United States prompting investors to further trim holdings in the red metal, brokers said.
"Overall, macroeconomic worries have definitely been a main factor in the slide in prices," said one California-based futures dealer. "I don't think things will be getting better any time soon, a lot of these credit problems will peak actually later in the first quarter of next year."
At the New York Mercantile Exchange's Comex division, most-active March futures were trading down 7.60 cents to $3.0025 a lb by 10:26 am EST (1526 GMT), treading near the bottom of their $2.9770-$3.08 morning range.
Spot December copper slumped 7.75 cents to $2.9835. San Francisco Federal Reserve Bank President Janet Yellen noted deterioration in financial conditions since October and said there had been an unexpected softening in economic data. "These developments necessitate some rethinking of my growth forecast, and have highlighted the downside skew in the risks to that forecast," said Yellen, not a voting member this year on the Fed's rate-setting committee.
In industry news, the Mexican government ordered Grupo Mexico and workers at the company's giant Cananea mine to restart talks this week to end a four-month strike that is crippling the country's copper output.
In China, the government of Jiangxi province plans to consolidate local lead and zinc mines and is considering to allow Jiangxi Copper Corporation to take over those mining assets, a senior executive said on Tuesday. Jiangxi Copper is the biggest integrated copper producer in China and is owned by the Jiangxi government.
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