LONDON: Copper prices slid to six-week lows on Monday as the deteriorating demand outlook in top consumer China was reinforced by debt problems in its property sector, a major consumer of the industrial metal.
Benchmark copper on the London Metal Exchange (LME) was up 0.1% at $8,304 a metric ton at 1607 GMT after touching $8,234.5 for its lowest since June 30.
Prices of the metal used in the power and construction industries have dropped 7% since Aug. 1.
Traders said the suspension in trading of private developer Country Garden’s 11 onshore bonds had thrown the spotlight on China’s property sector.
“China probably isn’t going to provide a big stimulus for its housing market, but it does need to be stabilised,” said Bank of America analyst Michael Widmer, adding that China’s monthly loan data had added to negative sentiment.
Widmer expects a small copper market deficit of 253,000 tons this year and global consumption at 25.6 million tons, up 1.8% from 2022.
China’s new bank loans tumbled in July and other key credit gauges also weakened, even after policymakers cut interest rates and promised to roll out more support for the faltering economy.
Traders and analysts are awaiting Chinese data on industrial production, urban investment, house prices and GDP this week, seeking clues on the health of the world’s second-largest economy.
Elsewhere, aluminium fell to $2,143.5 a ton, its lowest since July 10, on slowing global demand. Prices of the metal used in the transport, packaging and construction were last down 1.3% at $2,148 a ton.
Analysts expect the aluminium market to register a deficit this year, but not as large as the shortfalls in 2022.
Overall, base metals are under pressure from a stronger US currency, which makes dollar-priced commodities more expensive for holders of other currencies.
In other metals, zinc fell 1.9% to $2,352 a ton, lead slipped 0.6% to $2,097, tin retreated 4.1% to $25,360 and nickel ceded 0.7% to $20,100.
Comments
Comments are closed for this article.