Copper prices rose on Thursday, supported by output cut plans agreed by top copper smelters in China and signs of the Chinese economy stablising following improving industrial profits.
Three-month copper on the London Metal Exchange (LME) rose 0.4% to $8,883 per metric ton by 0653 GMT, while the most-traded May copper contract on the Shanghai Futures Exchange (SHFE) advanced 0.5% to 72,420 yuan ($10,021.73) a ton.
China’s top copper smelters have proposed a production cut of 5% to 10% amid a tight supply of raw materials, two sources with knowledge of the matter said.
China’s industrial firms posted higher profits in the opening months of the year, while its central bank set the yuan at a much stronger fixing than markets had expected, which could support the purchasing power of Chinese metals buyers.
Meanwhile, inventory build-up in most base metals in China, the world’s biggest metals consumer, has capped gains in metal prices.
“As the current copper price continues to be high, downstream companies are more afraid of high prices (and) transactions in many places are bleak,” said Huatai Futures in a note.
Copper slips on demand worries, lead drops as inventories jump
Miners Freeport Indonesia and Amman this week called on the Indonesian government to allow exports of copper concentrate to continue beyond May.
If allowed, the exports could ease the supply tightness outlook and potentially suppress refined copper prices.
LME aluminium increased 0.2% to $2,304 a ton, nickel jumped 0.8% to $16,760, zinc climbed 0.5% to $2,449, while lead eased 0.2% to $1,999.50 and tin fell 0.4% to $27,420.
SHFE aluminium edged up 0.3% at 19,480 yuan a ton, nickel rose 0.1% to 130,430 yuan, zinc was up 0.2% at 20,885 yuan, lead jumped 2% to 16,495 yuan while tin was nearly flat at 223,640 yuan.
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