Copper arrived on Monday at its highest level in three weeks, as China’s strong demand and the threat of miners’ strikes in Chile brought prices closer to 27-month highs in September, although the yuan’s strength limited progress.
The commodity closed on Monday on the London Metal Exchange (LME) at US$3,0704 a pound, after an increase of 0.43%, compared to Friday’s close.
Strong Chinese consumption has already been incorporated into prices and profits are likely to slow, said Kieran Clancy, an analyst at Capital Economics, warning that new coronavirus outbreaks could derail demand.
Chile’s Escondida mine union rejected BHP’s final offer in the contract negotiations, but the company said it would meet with workers’ representatives again to avoid a strike.
China will invest nearly $900 billion over the next five years to develop the country’s copper-intensive power grids, state media reported Saturday.
Copper cathode production from Chinese smelters increased by 3% in September compared to August, and production between January and September fell by 1.6% year-on-year to 6.26 million tonnes, Antaike said.
The yuan fell from an 18-month high to the dollar after China’s central bank reduced reserve requirements for some foreign exchange transactions. A lower yuan makes metals more important for Chinese buyers.
