Economic news

Copper Turns Higher as Strike Risk Offsets Weak China Data

LONDON, May 17 (Reuters) - Copper rose back towards last week’s record high on Monday as the threat of strikes at mines in Chile and belief among investors that prices will rally further offset weak factory data from top metals consumer China.

Benchmark copper on the London Metal Exchange (LME) was up 0.4% at $10,283.50 a tonne in official trading, close to last Monday’s all-time peak of $10,747.50.

Copper, used in power and construction, is up more than 30% this year and many analysts expect more gains as the world shifts from fossil fuels to copper-intensive electrification and demand outpaces supply.

However, Julius Baer analyst Carsten Menke said prolonged deficits were unlikely since higher demand from green technology would be partly offset by China’s demographic decline and transition from investment-driven to consumer-driven growth.

“In the medium to longer term we should see (copper) prices begin to fall,” he said.

CHINA DATA: China’s factories slowed output growth in April and retail sales significantly missed expectations.

CHINA STEEL: Chinese steel prices fell sharply, with buyers put off by higher prices and the government warning it will move against too rapid a rally.

CHINA OUTPUT: China’s aluminium production in April rose to a record monthly volume while output of nonferrous metals more broadly rose 11.6% year-on-year.

CHILE: A union representing workers at BHP’s Escondida and Spence mines in Chile rejected the company’s contract offer, raising the risk of a strike.

RISK: Political risk for miners is rising in South America’s copper-rich Andes as high poverty and debt levels drive potentially sharp policy shifts.

GLOBAL MARKETS: Global shares paused after a strong end to the prior week, though Chinese equities gained strongly. The dollar weakened slightly.

OTHER METALS: LME aluminium was up 0.7% at $2,479 a tonne, zinc rose 1.2% to $2,974, nickel gained 1.1% to $17,728, lead was up 1.9% at $2,195.50 and tin was 1.3% higher at $29,884.

Reporting by Peter Hobson; Additional reporting by Mai Nguyen and Tom Daly; Editing by Alexander Smith and Louise Heavens

Source: Reuters


To leave a comment you must or Join us


More news


Back to economic news list

By visiting our website and services, you agree to the conditions of use of cookies. Learn more
I agree