Copper prices in China surged to their highest levels in nearly two years on Wednesday, after Chinese smelters agreed to cut output amid a shortage of raw materials.
The most-traded May copper contract on the Shanghai Futures Exchange (SHFE) climbed as much as 1% to 70,380 yuan ($9,790.50) per metric ton, the highest since April 2022.
Benchmark three-month copper on the London Metal Exchange (LME) was up 0.3% at $8,678.50 a ton by 0646 GMT. Top Chinese copper smelters agreed on Wednesday to cut production at some loss-making plants to cope with a raw material shortage, two sources close to the matter said.
Global copper smelters less active in first two months of 24
Some global copper smelters were inactive in the first two months of this year compared to the same period last year, mainly because of Chinese inactivity, according to data from satellite surveillance of metal processing plants conducted by Earth-i.
Analysts had forecast that copper processing fees could rebound from the second quarter when Chinese smelters enter their maintenance season.
LME aluminium shed 0.3% to $2,258.50 a ton, nickel eased 0.3% to $18,500, zinc dipped 0.1% to $2,558, lead edged up 0.1% to $2,146.50 and tin lost 0.4% to $27,420.
SHFE aluminium rose 0.3% to 19,250 yuan a ton, nickel jumped 1.2% to 141,970 yuan, zinc advanced 0.2% to 21,390 yuan, lead edged up 0.3% to 16,325 yuan, while tin lost 0.2% to 219,900 yuan.
Most base metal prices have been moving sideways in recent sessions as bearish and bullish factors balance each other out.
On one hand, subdued Chinese economic growth outlook and the lack of strong stimulus measures in the country continued to weigh on metal prices.
On the other, prospects of US rate cuts, a weakening dollar and supply issues in select metals lent prices some support.
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