LONDON: Copper prices rose on Monday as hopes for improving demand in top consumer China provided support ahead of a briefing on the country’s policies to promote economic growth.
Benchmark copper on the London Metal Exchange traded 0.2% up at $9,963 a metric ton in official rings. Traders said a softer US currency making dollar-priced metals cheaper for holders of other currencies supported prices in the afternoon session in Europe. Industrial metals overall have been boosted by China’s announcement last month of its biggest economic stimulus since the COVID-19 pandemic.
“Demand was chugging along anyway at a moderate pace and the supply side on base metals is generally tight, with nickel a notable exception.” Indicating stronger copper demand, stocks in warehouses monitored by the Shanghai Futures Exchange are down nearly 60% since early June at 141,625 tons. Stocks in LME-approved warehouses have been declining since hitting their highest since 2019 in August.
Raising doubts over the strength of copper demand is the deep discount for cash copper over the three-month contract. The discount stands at about $150 a ton, down from a record high above $160 in July. Elsewhere, nickel was up 0.7% at $18,125 a ton, supported by short-covering and concern over disruptions at Ambatovy’s operations in Madagascar, traders said.
A prolonged disruption could tighten supplies and narrow expected surpluses. In other metals, aluminium was up 0.1% at $2,655 a ton, zinc gained 0.3% to $3,175, lead rose 0.6% to $2,163 and tin advanced 0.6% to $34,075.
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