Copper Leads Industrial Metals Lower on U.S. Debt, China Exports

Copper led declines in most industrial metals as deadlocked talks on the U.S. debt limit and an unexpected decline in China’s exports fueled concerns that demand may weaken from the world’s two biggest users.

The metal for delivery in three months on the London Metal Exchange dropped as much as 0.8 percent to $7,140 a metric ton and traded at $7,187.50 at 10:03 a.m. in Shanghai. Aluminum fell 0.4 percent and nickel retreated 0.5 percent.

The U.S. Senate wrapped up almost four hours of debate in Washington without unveiling a deal, with the nation’s borrowing authority set to lapse Oct. 17. China’s exports unexpectedly fell in September and inflation jumped on food prices, signaling constraints on the nation’s recovery.

“Investors expected American lawmakers to reach an agreement and they disappointed again,” said Xu Liping, an analyst at HNA Topwin Futures Co. in Shanghai, “In China, the September economic figures show that it’s no easy matter to have a sustained recovery in demand.”

The worldwide glut of copper supply is poised to almost triple in 2014, driving prices to the lowest in at least three years at a time when the International Monetary Fund says economic growth will be weaker than forecast. Copper stockpiles tracked by the Shanghai Futures Exchange rose to the highest level in almost two months last week.

Futures for delivery in December were little changed at $3.268 a pound on the Comex in New York. The January contract on the Shanghai Futures Exchange rose 0.4 percent to 51,850 yuan ($8,474) a ton.

Before it's here, it's on the Bloomberg Terminal.