BEIJING: Copper prices were largely flat on Tuesday, as resilient demand from top consumer China and mine-side supply issues countered pressure from a slightly firmer US dollar.
Three-month copper on the London Metal Exchange was up 0.1% at $8,488.50 per metric ton by 0431 GMT, while the most-traded January copper contract on the Shanghai Futures Exchange slid 0.1% to 68,500 yuan ($9,590.61) per ton.
The unexpectedly strong demand and increasing concern that supply is failing to keep up with demand amid mine disruptions led to copper’s resilience, analysts at AMT research said in a note.
They noted Chinese copper prices were higher than global prices, which suggested continued strong imports by China in December.
That was despite strong production in China. The country produced 1.14 million metric tons of refined copper in November, up 12.3% from a year earlier, data showed on Monday.
Also supporting the market was a rise in spot premium this week, analysts at Guotai Junan Futures noted. Refined copper was traded at a premium of 155 yuan per ton against futures prices on Monday, compared with a discount for much of last week.
Copper slips, but prospect of tight supplies sustains sentiment
The dollar index edged higher on Tuesday, as the Japanese yen fell after the Bank of Japan kept its ultra-loose monetary policy unchanged and maintained its forward guidance.
A stronger dollar weighs on metals prices as it makes the greenback-priced commodities more expensive to buy. Elsewhere, metal prices were also under pressure.
LME aluminium lost 0.8% to $2,265.50 a ton as inventories climbed, nickel declined 0.2% to $16,475, zinc decreased 0.1% to $2,535.50, lead nudged 0.2% lower to $2,054.50, while tin rose 0.7% to $24,990.
SHFE aluminium increased 0.4% to 18,940 yuan a ton, zinc edged up 0.1% to 20,840 yuan, and tin gained 0.5% to 208,410 yuan, while lead slipped 0.2% to 15,635 yuan, nickel fell 2.1% to 130,500 yuan.
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