Copper Drops as China Exports Fuel Concern Supply to Top Demand
Shipments gained 10 percent in March from a year earlier, Chinese customs figures showed today, below the median estimate of 11.7 percent in a Bloomberg News analyst survey. Imports were stronger than predicted. Inventories of copper tracked by the London Metal Exchange are the highest since September 2003.
“Macro sentiment remains shaky as nervous market participants look for more signs of gaining momentum in China’s economy, eventually driving seasonal demand for metals,” Andrey Kryuchenkov, an analyst at VTB Capital in London, said in a report today.
Copper for delivery in three months dropped 0.3 percent to $7,610 a metric ton by 9:52 a.m. on the LME. Prices increased 2.4 percent, the most since Jan. 2, by yesterday’s close. Copper for delivery in May fell 0.1 percent to $3.4375 a pound on the Comex in New York.
Rio Tinto Group is “cautiously optimistic” the first commercial production at its Oyu Tolgoi copper project in Mongolia will come in summer, Jean-Sebastien Jacques, head of the company’s copper unit, said in an interview in Santiago. Vedanta Resources Plc’s output of mined copper in Australia rose 15 percent in the year through March, a statement showed.
Chinese imports of unwrought copper and products rebounded in March from February’s 20-month low, customs figures showed.
“The market ignored the better-than-expected Chinese import figure and rise of copper imports in March and chose to react to the exports missing estimates,” Pengjiang “Richard” Fu, director for Asian commodities trading at Newedge Group SA in London, said by e-mail.
A 24-hour strike by Chilean copper miners at Codelco, the world’s biggest producer, is scheduled to end today. The state- owned company accounts for 10 percent of global mine supply.
LME copper stockpiles increased 0.1 percent to 587,925 tons, daily exchange figures showed. Orders to take the metal from warehouses gained 3.4 percent to a record 156,975 tons.
Aluminum, nickel, lead, tin and zinc rose in London.
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