Shanghai copper futures fell by their 5 percent limit on Friday, after London futures shed nearly 5 percent in the previous session and investors fretted about oversupply and rising stocks. Shanghai August copper touched 61,360 yuan ($8,002) a tonne during the session, down 3,230 yuan from Thursday's settlement.
Prices had recovered slightly to 61,410 yuan. Copper for delivery in three months on the London Metal Exchange was down $111 at $7,140. On Thursday, copper dipped to $7,095 a tonne, it's lowest since April 3, and was down nearly 15 percent from an 11-month high touched on May 4.
Weighing on sentiment was a forecast by the International Copper Study Group that the copper market would be in surplus by 280,000 tonnes in 2007 and expectations that Shanghai copper stocks could rise by 12,000 tonnes or more this week to nearly 100,000 tonnes, as the market struggles to digest record imports.
"The recent fall, mainly due to ample physical supply in China, will not change the long-term upturned in copper prices," said analyst Li Rong at Great Wall Futures, adding that he expected prices would recover from $7,000 in London and 60,000 yuan in Shanghai.
"Global consumption is good, but it may take a while for Chinese users to absorb the copper in the domestic market." Spot copper in Shanghai traded between 60,250 and 60,550 yuan, down 2,925 yuan.
China's imports of refined copper, anode and copper alloy in April stood at 205,053 tonnes. That was down 6.5 percent from March's record of 219,359 tonnes but still exceeded expectations.