Copper Prices Drop as China’s Inventory Jump Most in Three YearsJoe Deaux
Copper futures fell for the first time in four days on signs of ample global supplies as inventories rose the most in three years in China, the world’s top consumer of industrial metal.
Stockpiles in the week that ended Thursday surged 33 percent from a week earlier, the biggest gain since February 2012, data from the Shanghai Futures Exchange showed. Markets in China opened Wednesday after a week-long Lunar New Year holiday. On Monday, supplies at warehouses tracked by the London Metal Exchange rose to a one-year high.
“Today’s selloff is a combination of two things: the weekly stocks increase for Shanghai warehouses that hadn’t been reported during the holiday time period, but also material continues to move into LME warehouses,” Eric Zuccarelli, an independent trader in New York, said in a telephone interview.
Copper futures for May delivery dropped 0.1 percent to settle at $2.6915 a pound at 1:27 p.m. on the Comex in New York. Earlier, the price fell as much as 1.3 percent.
In February, the metal rose 7.9 percent, the most since September 2012, amid mounting speculation that China’s government will expand economic stimulus.
Copper for delivery in three months rose 0.1 percent to $5,895 a metric ton ($2.67 a pound) on the LME. The price has dropped 16 percent in the past 12 months, while combined inventories monitored by exchanges in Shanghai, London and New York have advanced 6.7 percent to 517,779 tons, the highest since December 2013.
On the LME, lead, nickel, tin and zinc declined, while aluminum gained.