LONDON: Copper prices came under pressure on Thursday from a stronger dollar and weak data from top metals consumer China, after hitting their highest in almost a month in the previous session.
Benchmark three-month copper on the London Metal Exchange was down 0.7 percent at USD10,893.50 a metric ton by 1121 GMT. The metal touched USD11,025 on Wednesday, its highest since October 30, on the expectations that the US Federal Reserve will cut interest rates in December. It hit a record high of USD11,200 on October 29 due to mine supply disruptions.
With the US markets closed for the Thanksgiving holiday, the metals market focus was on data showing that China’s industrial profits contracted in October as well as on developer Vanke’s debt woes. On the technical front, copper is supported by the 21-day moving average at USD10,811.
The 2percent-3percent premium of the Comex copper contract over the LME benchmark, which keeps attracting the metal into the US stockpiles, is likely to persist over the next 18 months, an LME executive said, citing uncertainties around copper tariffs in the US Comex copper stocks, last at 378,900 metric tons, hit a record high last week and have continued to climb this week.
Stocks in the LME-registered warehouses are down 42percent this year at 157,175 tons. This is adding to concerns that the inventories outside of the US will stay relatively tight.
The premium for the LME cash copper contract over the three-month forward hit its highest since mid-October of USD25 a ton on Monday and was last at USD20 on Thursday.
In other LME metals, aluminium fell 0.9 percent to USD2,836.50 a ton, zinc lost 1.1 percent to USD3,023.50, while lead and nickel were steady at USD1,979 and USD14,815, respectively.
Tin rose 0.1percent to USD37,970 after hitting USD38,650, a peak since May 2022, on persistent worries about supply disruptions in Asia.
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