Shanghai copper prices fell on Monday tracking losses in London, amid a firmer dollar and a lack of clear demand improvement from the troubled Chinese property market.
The most-traded June copper contract on the Shanghai Futures Exchange (SHFE) fell 0.7% to 81,180 yuan ($11,254.84) per metric ton at the midday break, tracking an aggregated 0.8% decline on the London Metal Exchange, while the Chinese markets were closed for a holiday last week.
SHFE zinc shed 0.2% to 23,330 yuan, tin dropped 0.6% to 259,820 yuan, while aluminium rose 0.7% to 20,745 yuan, lead advanced 1.4% to 17,575 yuan and nickel increased 0.4% to 144,590 yuan.
The London Metal Exchange is closed for a public holiday. The dollar index rebounded, after hitting a three-week low in the previous session.
A firmer dollar makes greenback-priced metals more expensive for holders of other currencies. Copper prices have been supported by a potential cut of smelters’ output due to limited mine supply.
However, data has not reflected any large cut and smelters with long-term raw material supply contracts are less likely to do so soon.
Copper rebounds on weak dollar
“The (copper) smelting profit of long-term orders still remains above 1,700 yuan a ton, so the willingness of companies with long-term orders to actively reduce production may be relatively limited,” said Huatai Futures in a report.
Despite the Chinese real estate sector showed no sign of bottoming out, steady demand from the power, electric vehicles and home appliances sectors contributed to a generally good end-user copper demand, Huatai analysts said in the report.
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