Copper fell in New York on concern demand is poised to slow as supply expands and economies falter from Europe to China, the world’s biggest consumer of the metal.
Copper supply from mines may increase by almost 2 million metric tons by the end of 2015, Credit Suisse Group AG said today, triple the current level of stockpiles tracked by the London Metal Exchange. Credit-rating firms in China, where the economy weakened for nine of the last 10 quarters, cut the most bond-issuer rankings on record in June.
“Macro concerns persist, especially in regards to China, where widespread bond downgrades are highlighting consistent credit concerns over firms with ties to state or local governments,” James Marks, head of global metals at Xconnect Trading Ltd., a London-based interdealer broker, said by e-mail.
Copper for delivery in September retreated 0.4 percent to $3.12 a pound by 6:46 a.m. on the Comex in New York. Prices are down 1.1 percent this week, set for a first decline in three. Copper for delivery in three months fell 0.3 percent to $6,882 a ton on the LME.
Mining companies Anglo American Plc, BHP Billiton Ltd. and Rio Tinto Group said this week their production of copper advanced from a year earlier in the three months through June. The market should refocus its attention on the surplus predicted for this year after three annual deficits, Australia & New Zealand Banking Group Ltd. said in a note today.
The euro-area unemployment rate climbed to 12.2 percent in May, while factory orders and exports unexpectedly slid in Germany, the bloc’s largest economy, figures showed this month. Yields on Portuguese two-year notes are the highest relative to the 10-year rate in more than a year, highlighting an “increased chance of a required bailout,” according to Marks.
“Europe continues to spiral into an ever-increasing reliance on bailouts as unemployment dents any consumer activity,” he said.
Copper stockpiles monitored by the LME fell 0.4 percent to 638,325 tons, daily exchange figures showed. Orders to remove the metal from warehouses declined 0.7 percent to 334,175 tons.
Tin fell in London as aluminum and nickel rose. Lead and zinc were little changed.