Copper prices dragged lower by virus resurgence fears

• Three-month copper on LME was 0.2% lower at $5,245 a tonne in official trading.

LONDON: Copper prices eased on Wednesday on fears of a second wave of coronavirus infections in top metals consumer China and in  South Korea.

New infections have been reported in the last two weeks in Chinese cities including Wuhan, the epicentre of the first wave, and in South Korea, leading to fresh restrictions to control the spread.

Meanwhile, U.S. infectious disease expert Anthony Fauci warned lawmakers that lifting sweeping lockdowns in the country could spark a new outbreak of the illness.

"If we do have a second wave of infections then it would mean lower demand for base metals in energy and for everything," said Commerzbank analyst Daniel Briesemann.

China, the world's second largest economy, accounts for nearly half of global copper consumption estimated at 24 million tonnes.

Three-month copper on the London Metal Exchange (LME)  was 0.2% lower at $5,245 a tonne in official trading.

DEMAND DESTRUCTION: Demand destruction caused by the COVID-19 pandemic will dwarf the impact of supply disruptions for industrial metals such as aluminium and zinc, leaving heavy surpluses and inventory levels that will pressure prices and output this year.

"The bigger picture for metals right now is that on the supply side impacts are nowhere near enough to offset the surpluses," said Capital Economics analyst Kieran Clancy.

NICKEL: Miners in top producer Philippines are allowed to operate at full capacity as the country begins to relax coronavirus-containment measures, but they must follow strict safety protocols.

TENSIONS HIGH: Wanton obstructions on U.S. investors under the pretext of national security runs counter to economic law and will end up costing the investors, the Chinese foreign ministry said on Wednesday.

Tensions between the world's largest economies have been rising over the coronavirus and come on the back of the trade war that hurt metals demand and hit global markets.

IMF: International Monetary Fund (IMF) Managing Director Kristalina Georgieva said it was "very likely" the Fund would cut global growth forecasts further as the pandemic was hitting many economies harder than previously projected.

COPPER PREMIUM: Copper premiums in bonded warehouses of Yangshan climbed to their highest since October 2018 of $110 a tonne on favourable import arbitrage trade.

ZAMBIA COPPER: Zambia temporarily shut its border with Tanzania to enhance measures against the spread of the new coronavirus, delaying its main copper exports via Dar es Salaam.

OTHER PRICES: LME aluminium slipped 0.1% to $1,476.50 a tonne, zinc dropped 1.2% to $1,980.50, lead  declined 0.8% to $1,624.50, tin eased 0.4% to $15,154, while nickel fell 0.5% to $12,256.