Shanghai copper gains on strong China demand, investors assess Mideast truce

Copper prices in Shanghai rose on Monday, supported by resilient demand in top consumer China, while investors weighed a fragile ceasefire between the United States and Iran which is set to expire and the future of peace talks between the two countries.

The most active copper contract on the Shanghai Futures Exchange rose 0.73% to 102,780 yuan ($15,070.60) a metric ton, as of 0330 GMT.

The benchmark three-month copper on the London Metal Exchange, nudged 0.07% lower to $13,338 a ton, after pulling briefly into the green, up slightly by 0.17%.

The US said it had seized an Iranian cargo ship on Sunday, while Iran vowed retaliation and said it would not participate in a second round of negotiations ahead of the ceasefire’s expiry on Tuesday.

While the US blockade on Iranian ports remained in place, Iran effectively reimposed closure on traffic through the Strait of Hormuz, pushing oil price higher and prompting investors to assess the risk of severely reduced shipping through the key waterway.

Meanwhile, copper stocks in warehouses monitored by SHFE continued to decline, indicating stronger demand in China and lending support to the red metal. SHFE copper inventories fell 9.8% week on week to 240,456 tons on Friday.

It has declined near 45% since March 13.

The Yangshan copper premium, a gauge for China’s appetite for imported units, remained strong at $68 a ton on Friday, despite falling from $74 a ton on April 14.

Elsewhere, aluminium on the LME was little changed after Friday’s pull-back, up 0.18% at $3,571 a ton, while SHFE aluminium fell 1.22% to 25,195 yuan to match the London decline.

Elsewhere on SHFE, zinc rose 1.08%, lead added 0.18%, nickel declined 0.88% and tin gained 0.26%.

Among other LME metals, zinc was up 0.22%, lead ticked 0.05% higher, nickel gained 0.97% and tin lost 1.32%.