Copper Futures Slide as Chinese Production Climbs in First Halfby and
Output in China jumps by 7.6% as smelter margins improve
Nickel, other metals drop as dollar touches seven-week high
Copper retreated on concern that supply will keep outpacing demand as data showed rising output in China, the biggest producer and user of refined metal. A stronger dollar also hit commodities priced in the currency.
China’s production grew 7.6 percent in the first half, according to the National Bureau of Statistics Wednesday, as smelter margins improved. There will be a global surplus every year until 2020, Barclays Plc said in a July 19 note.
“Chinese output figures continue to rise despite many a proclamation to the contrary,” Michael Turek, the head of base metals at BGC Partners Inc. in New York, said in an e-mail. “As a barometer of demand, physical premiums are still not displaying any spark even if we are in the dog days of summer.”
Copper futures for delivery in September declined 0.4 percent to settle at $2.254 a pound at 1:16 p.m. on the Comex in New York.
Other metal prices also fell as investors realized some profit after boosting their net-bullish bets in most metals last week, according to Commerzbank AG. Money managers boosted net-bullish bets in nickel to a record last week as aluminum wagers climbed to the highest since December 2014 on the LME. Copper’s net-long position was at the highest level in two months last week.
The Bloomberg Dollar Index touched the highest in seven weeks, making commodities sold in the U.S. currency costlier for buyers in other countries.
Copper also declined on the London Metal Exchange along with aluminum and lead, while zinc, nickel and tin rose.