Copper futures posted the biggest two-session drop in 28 months on signs of faltering economic growth from France to China, the world’s biggest consumer of industrial metals.
On the Comex in New York, copper dropped below $3 a pound for the first time since June. French industrial production production unexpectedly dropped in January for the second straight month, and business confidence declined, separate reports showed today. In China, exports slid in February by the most since 2009, government data showed on March 8.
This year, copper has slumped 11 percent, the most among 34 commodities tracked by Bloomberg. Global consumption of the metal will trail production by 81,000 metric tons in 2014 after a deficit of 175,000 tons last year, Barclays Plc said on Feb. 12. Shares of Freeport-McMoRan Copper & Gold Inc., the largest biggest publicly traded producer, have tumbled 8.2 percent in three sessions.
“When you have a series of data, especially covering two major economic zones as China and the European Union do, that would suggest weaker demand,” Tim Evans, the chief market strategist at Long Leaf Trading Group in Chicago, said in a telephone interview.
Copper futures for May delivery dropped 1.7 percent to settle at $3.0315 at 1:28 p.m. in New York. Earlier, the metal touched $2.9955, the lowest for a most-active contract since June 25. In two sessions, the price tumbled 5.8 percent, the most since Oct. 20, 2011.
Trading was 63 percent higher than the 100-day average, data compiled by Bloomberg show.
Speculators switched bets to bearish from bullish in the week ended March 4, government data showed March 7. Hedge funds held a net-short position of 2,567 contracts, compared with net longs of 1,459 a week earlier.
China’s imports of unwrought copper and copper products fell to 380,000 metric tons in February from a record 536,483 tons a month earlier, customs data show. Currency depreciation, weakening demand from end users and rising domestic output of refined metal contributed to the the decline, Citigroup Inc. said.
Copper stockpiles tracked by the Shanghai Futures Exchange have climbed for eight straight weeks, the longest advance since February 2012.
On the London Metal Exchange, copper for delivery in three months fell 2 percent to $6,649 a ton ($3.02 a pound). Zinc, and lead declined, while nickel, tin and aluminum rose.