normal
It reached $9,578 per ton
April 12, 2024
14:03 pm
Copper cathode sheets at a factory near Santiago, Chile (Reuters)
Copper continued to rise, hitting a 22-month high, as investors bet that shrinking mine supplies will struggle to keep up with renewed global demand.
Copper has found itself in a strong position following the mine supply shock late last year, which has now combined with stronger than expected demand as global manufacturing demand rises.
Futures on the London Metal Exchange have risen more than 12% so far this year, and are trading at the highest level since June 2022. Copper rose as much as 2.5% to $9,578 a tonne.
Investors are focusing on signs of a recovery in China’s industrial sector and expectations of lower global interest rates, while disruptions at major mines have put pressure on profit margins at Chinese factories that account for more than half of global supplies, raising the possibility of a cut in production of the refined metal.
Concerns about production were exacerbated for the first time by Panama’s order late last year to close a giant First Quantum mine, removing nearly 400,000 tons of the metal from the global annual supply.
Supply expectations tightened further after Anglo American announced that it would reduce its production by about 200,000 tons, and the market initially ignored these cuts, as consumption appeared weak. But this has changed as signs of industrialization, the main driver of copper demand, have emerged around the world.
The rise in copper prices coincided with a rise in commodity prices on a broader scale, and gold is currently trading at a record level, while zinc is trading at its highest level in a year.
A broad measure of basic metals reached its highest level in a year earlier this week, joining gains recorded by other commodities, including crude oil. As for basic metals, the sector’s recovery came at a time when the US economy is showing signs of resilience. Sustainable, while macroeconomic signatures from China point to stability. (Bloomberg)
2024-04-12 10:03:38
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