Copper prices hit a three-week low on Thursday and other base metals also eased as uncertainty persists over economic conditions and demand growth.
Benchmark copper on the London Metal Exchange (LME) was down 0.7% at $9,462 a metric ton by 0938 GMT after touching it lowest since May 1 at $9,223.20.
“A real state of paralysis has swept through metals markets,” said Alastair Munro at broker Marex, pointing to the expiry of LME benchmark contracts last week.
Prices have been pressured by a sharp rise in Chinese copper inventories last week, ending a three-week run of large withdrawals. Analysts and traders said that the rise was due to tepid copper demand in China and steady output from a growing smelting sector.
Also weighing on the market was the prospect of more supply after Freeport Indonesia’s Manyar smelter in East Java resumed operations ahead of schedule after a fire last year. It is expected to produce copper cathode by the fourth week of June.
Copper drifts higher on worries about US debt
Investor sentiment, meanwhile, remained subdued in the face of a deteriorating U.S. fiscal outlook, with last week’s Moody’s downgrade fueling a growing “Sell America” narrative and leaving markets adrift.
Helping to curb losses was a softer U.S. dollar, making dollar-priced metals cheaper for buyers with other currencies.
LME lead fell 1.1% to $1,952 a ton after touching its lowest since May 9 at $1,947.50.
On-warrant LME lead inventories have surged by 91% over the past two days to 234,000 tons, their highest since December 2024.
Among other metals, aluminium dipped 0.2% at $2,467 a ton, zinc eased by 0.2% to $2,688 and nickel was down 0.9% at $15,450 while tin lost 1.4% to $32,365.
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