Copper fell to a four-week low in New York as China, the world’s biggest consumer, moved to cool property purchases and as inventories of the metal expanded.
Chinese Premier Wen Jiabao called for local authorities to “decisively” curb real-estate speculation. Cities that have witnessed “excessively fast” price gains should promptly impose home-purchase restrictions, the central government said in a statement. Stockpiles monitored by the London Metal Exchange reached the highest since November 2011.
“China is going to take steps to cool their housing market, and there’s nothing promoting growth at this point,” Harry Denny, a broker at Hoboken, New Jersey-based PVM Futures Inc., said in a telephone interview. “The market is going to continue to be under pressure unless we start to see depletion of the warehouse stocks.”
Copper futures for May delivery declined 1.1 percent to settle at $3.625 a pound at 1:22 p.m. on the Comex in New York, after touching $3.622, the lowest for a most-active contract since Jan. 17. Prices are down 2.9 percent in February, heading for the first monthly decline since October. Futures extended the decline in electronic trading to $3.613, after Federal Reserve policy makers indicated the central bank may be ready to vary the pace of monthly bond purchases.
The construction industry accounts for about 9.4 percent of China’s demand for the metal, according to data from Bloomberg Industries.
LME-monitored inventories climbed for a fifth session to 412,950 metric tons on deliveries in Johor, Malaysia, daily exchange figures showed. Stockpiles are up 35 percent from a year ago. Orders to withdraw the metal are at the lowest since July.
Signs of a continued housing recovery in the U.S., the second-biggest copper user, helped limit price declines. Builders broke ground in January on the most single-family homes in more than four years, and permits for future construction rose, a government report showed.
On the LME, copper for delivery in three months slumped 1.1 percent to $7,960 a metric ton ($3.61 a pound), the fourth straight decline and the longest slump in a month.
Nickel, aluminum, tin, lead and zinc also fell in London.