BEIJING: Copper prices were under pressure on Tuesday amid growing concerns over the demand outlook in top consumer China after the latest policy pledges disappointed.
Three-month copper on the London Metal Exchange was up 0.2% at $9,236 per metric ton as of 0429 GMT, while the most-traded September copper contract on the Shanghai Futures Exchange slid 0.9% to 75,520 yuan ($10,382.47) a ton.
Both contracts were at the lowest level since early April.
“There are growing fears of worsening economic situation,” a Chinese futures trader said. Last week, China reported weaker-than-expected second-quarter economic growth, raising concerns about metals demand and sparking a sell-off in the market.
On Monday, the country’s central bank surprised markets by cutting major short- and long-term interest rates, its first such broad move since August last year. However, this did little to ease concerns around demand.
The market was also disappointed by a lack of further stimulus from the plenum last week, ANZ analysts said in a note.
Amid subdued domestic consumption, Chinese copper producers shipped out a record 157,751 metric tons last month, contributing to higher inventories in LME warehouses that weighed on prices.
The global refined copper market showed a 65,000 metric tons surplus in May, compared with an 11,000 metric tons surplus in April, the International Copper Study Group (ICSG) said in its latest monthly bulletin.
But with falling prices, trades in China became more active this week, traders said.
LME aluminium gained 1% to $2,321.50 a ton, lead added 0.4% at $2,091.50, zinc was 0.5% higher at $2,739, tin rose 1% to $30,175, while nickel was down 0.2% at $16,160.
SHFE aluminium dropped 1% to 19,360 yuan a ton, nickel dipped 0.2% to 128,760 yuan, lead slid 0.8% to 19,135 yuan, tin lost 2.5% to 251,590 yuan and zinc shed 0.6% to 23,280 yuan.