Copper prices fell on Tuesday pressured by China’s lower metals imports.
Copper for delivery in September fell 1.4% from Monday’s settlement price, touching $4.372 per pound ($9,619 per tonne) on the Comex market in New York.
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China’s factory activity expanded in July at the slowest pace in 17 months, with the official Purchasing Managers’ Index (PMI) easing to 50.4 from 50.9 in June, remaining above the 50-point level that separates growth from contraction.
China’s imports of unwrought copper have also been trending lower since the sharp recovery from the coronavirus pandemic amid stimulus spending in the middle of last year.
Imports reached a high of 762,211 tonnes in July of 2020, and have been dropping ever since.
Surging Chinese scrap copper imports that have doubled in the first half of 2021 are also displacing to some extent refined cathode, concentrate, anode, and blister imports, with analysis by Roskill predicting the situation to worsen and potentially cripple the copper price recovery.
Meanwhile, Fitch Solutions Country Risk & Industry Research says it expects near-term stabilization after copper and tin reached fresh highs in May and July, respectively:
“Nevertheless, there should be no collapse and prices will remain elevated compared to previous years, on the back of tight fundamentals and positive investor sentiment due to the ongoing global economic recovery.”
(With files from Reuters)