LONDON- Copper prices broke below $8,000 a ton for the first time since Nov. 29 on Wednesday, extending this week’s decline on subdued Chinese demand and concern over global economic growth that analysts expect to weigh on prices in the coming days.
Benchmark three-month copper on the London Metal Exchange (LME) fell 2.6 percent to $7,890.5 a ton after dropping to its lowest in nearly six months at $7,867.
Copper hit a seven-month high of $9,550.50 in January after China removed its COVID curbs, but prices for the metal used in power and construction have since retreated.
“Copper has now given back all of its 2023 gains on weaker than expected Chinese demand, in what is normally a peak construction season, and subdued demand in the US and Europe, with interest rate rises weighing on economic growth,” said ING analyst Ewa Manthey.
“Hopes for higher demand from China have now faded with recent disappointing Chinese data underscoring a mixed picture for the world’s biggest consumer of copper.”
Copper is also weighed down by growing inventories in LME-registered warehouses said Standard Chartered analyst Sudakshina Unnikrishnan.
“The much-anticipated rebound in China’s copper imports and demand following the abrupt end to COVID lockdown policies has failed to materialize as of yet.”
Rising LME inventories increased the discount on the cash contract against three-month copper to $66 a ton, its widest since early 1990s.
Among other metals, LME aluminum fell 0.7 percent to $2,212 a ton after hitting its lowest since Oct. 31 at $2,190.
Nickel lost 1.6 percent at $20,710 after touching $20,700 for its lowest since Sept. 2 while zinc was down 2.9 percent at $2,303 after sliding to $2,295.5, its weakest since October 2020.
Lead, meanwhile, retreated by 1.1 percent to $2,050.5 and tin lost 1.1 percent to $24,050.
