BEIJING: Prices of copper slid on Wednesday, amid gloomy demand outlook in top consumer China and expectations of rising supplies, despite support from the weakness in the dollar.
Three-month copper on the London Metal Exchange was was down 0.5% at $8,432 per metric ton by 0423 GMT, extending a downtrend from the previous session.
Weak copper consumption in China has been reflected in a widening spot discount in the market and increase in inventories.
Demand from the power sector, the main consumer of copper, is expected to grow slower in the second half of this year, having posted a healthy gain in the second quarter, according to CITIC Futures.
China consumption will grow 3.9% this year, while refined copper production in China will rise 8%, with new projects coming online, CITIC Futures added.
Higher global prices amid tight overseas inventories have subdued import appetite, pushing down the Yangshan copper import premium to $42 a metric ton on Tuesday, down 21.5% from an intra-year high two weeks ago.
However, import volume is seen rising to 310,000 metric tons with more flows from Congo and Russia, analysts at Yinhe Futures said.
The dollar index edged up on Wednesday but was close to its 15-month low.
Copper edges up in London as dollar hovers near 1-year low
A weaker dollar makes the greenback-priced commodity cheaper for non-dollar holders. The most-traded August copper contract on the Shanghai Futures Exchange nudged up 0.1% to 68,470 yuan ($9,500.22) per metric ton.
SHFE aluminium gained 0.2% to 18,245 yuan a metric ton, zinc dipped 0.2% to 20,155 yuan, lead was little changed at 15,720 yuan, nickel ticked up 1.3% to 165,230 yuan, and tin rose 0.5% to 231,980 yuan.
LME aluminium edged up 0.1% to $2,204.50 a metric ton, while tin dropped 0.8% to $28,300, lead dipped 0.1% to $2,095, nickel lost 0.9% to $20,900, and zinc fell 1% to $2,371.50.
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