LONDON: Copper resumed its upward momentum on Wednesday after a two-session pause, but traders said Chinese consumer reluctance to buy around two-year highs was capping gains.
Three-month copper on the London Metal Exchange was up 1.3% at $9,830 a metric ton at 1500 GMT. It has retreated a little from the $9,988 hit earlier in the week on profit-taking and producer hedging.
Metal industry sources say the recent rally towards $10,000 has dampened appetite for imports in top consumer China.
“End users are rejecting the current copper price,” said one trader in China, adding that some clients were asking for deliveries to be deferred in the hope that the market cools.
Copper prices in Shanghai have been breaking record highs in almost every session this month. “The general consensus (at an industry conference last week) was that prices will be able to sustain these levels and keep going up,” said Macquarie analyst Alice Fox. “Everyone we met expected the market to be in deficit this year, although the magnitude of that deficit varied widely - the largest we heard was around 700,000 tons for 2024.”
“Plenty of traders are offering discounts already on exchange-deliverable copper brands,” another trader said. Other metals also rebounded on Wednesday. Tin rose 0.4% to $32,060 after falling by its most in almost two years in the previous session. LME nickel rose 0.3% to $19,060 a ton, aluminium gained 1.3% to $2,612.5, zinc was up 1.4% at $2,816.5 and lead gained 1% to $2,205.5.
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