LONDON: Copper slipped on Monday as fears that top consumer China would take action to curb any further rises in prices of industrial metals and the notion of fundamentals overtaking prices sparked some selling.

Benchmark copper on the London Metal Exchange traded down 0.2% at $9,980 a tonne at 1601.

Prices of the metal, often used as a gauge of manufacturing activity, are down nearly 8% since hitting a record high of $10,747.50 a tonne in May. Over the last week they have mostly traded between $9,800 and $10,000 a tonne.

“The “grand” opening of economies because of vaccinations and the reflation story was priced in very quickly. The market is now taking a more sober view of fundamentals,” said Julius Baer analyst Carsten Menke.

“At the same time we have Chinese authorities saying they will crack down on speculation in commodity markets.”

Clues to Chinese demand for base metals will come this week with industrial production data for May. The consensus is for an activity slowdown.

China plans to release state reserves of non-ferrous metals copper, aluminium and zinc in a programme set to last until the end of 2021, data provider Shanghai Metal Exchange Market and Chinese analysts said.

“Sales of aluminium and zinc are dramatically more likely than copper since China is short copper and the refined copper market is not tight at present,” Citi analysts said.

China’s state planner last week renewed its pledge to step up monitoring of commodity prices, as domestic producer inflation hit its highest in more than 12 years.

Stocks of copper in LME registered warehouses at 138,300 tonnes, up 24% since May 12 have eased worries about supplies on the LME market. This is seen in the $28 a tonne discount for the cash over the three-month contract compared with a $20 a tonne premium on April 26.

Aluminium was up 1.3% at $2,497 a tonne, zinc rose 0.4% to $3,060, lead gained 0.1% to $2,201, tin added 0.4% to $31,700 and nickel climbed 1.3% to $18,465.