LONDON: Copper prices slipped on Thursday as expectations that demand growth in top consumer China had reached a plateau surfaced, but losses were capped by a lower dollar and sliding stocks in London Metal Exchange registered warehouses.
Benchmark copper on the LME was down 0.2% at $8,028 a tonne at 1703 GMT. Prices of the metal used widely in power and construction touched eight-year highs of $8,238 a tonne earlier this month, up some 90% since March when demand slumped due to coronavirus lockdowns.
“What happens in China is more relevant for copper demand than any recovery in the rest of the world.
The good news is priced in, there isn’t room for much more upside this year,” said Julius Baer analyst Carsten Menke.
Stocks of copper in LME warehouses at 91,150 tonnes have halved since last October and are at their lowest since September.
Cancelled warrants, metal earmarked for delivery, at 40% suggest more copper is likely to leave LME warrant.
This has fuelled worries about copper availability on the LME market and narrowed the discount for the cash over the three-month contract to $2 a tonne from $16 at the start of January.
Worries about supplies of the stainless steel ingredient from New Caledonia where protests have disrupted operations have pushed prices to $18,515 a tonne, the highest since September 2019. It was up 1.1% at $18,415. Aluminium was up 0.9% at $1,999 a tonne, zinc fell 0.4% to $2,717, lead slipped 0.4% to $2,035 and tin climbed 1.7% to $22,010.
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