Copper rose to a record high this Friday, driven by speculators and industrial buyers behind optimistic economic data as Western economies recover from the pandemic.
At the start of its operations, the red metal was traded at US$4,69967 a pound, which compares to $4,54749 on Thursday. Today’s result surpasses the mark imposed on February 14, 2011, when it was traded to US$4,60306.
Prices have soared 135% since last March’s lows, when the COVID-19 pandemic began to affect demand.
“We’re in uncharted territory right now (…), the industrial players are in panic mode because there’s not much supply,” said Gianclaudio Torlizzi, partner of Milan consultancy T-Commodity.
“But once stock levels in industrial warehouses begin to stabilize, along with china’s credit slowdown, that should pave the way for lower consolidation,” he added.
The June copper contract on the Shanghai Futures Exchange rose to 2.7% to 74,950 yuan ($11,603) a tonne, its highest level since May 2006 and only 1.6% below its all-time high of 76,160 yuan.
It is worth mentioning that China’s copper imports fell in April from the previous month, as customs data showed, as an uptick in prices to the highest levels in a decade made purchases less attractive.
The high record of red metal comes in the midst of the discussion in Chile on the mining royalty project, which proposes state compensation for the exploitation of copper and lithium from a tax on 3% of the sale of minerals. This Thursday, the House of Meps and Deputies dispatched the initiative to the Senate.
The value of Chilean copper exports soared again in April amid a solid recovery in global metal prices, according to a central bank report.
Red metal prices have risen to historic levels this year amid optimism about the recovery of the world economy after the impact of the coronavirus pandemic.
Chile’s largest copper producer, chile’s shipments, climbed 69% year-on-year to $4.541 million in the fourth month.
This accumulates the third consecutive month with a year-on-year hike of more than 50%.
In addition to the state-owned Codelco, other global giants such as BHP, Glencore, Anglo American, Freeport McMoRan and Antofagasta operate in the country.
Revenues from raw copper and products to China, the world’s largest consumer of metal, totaled 484,890 tonnes last month, the General Administration of Customs said. The figure represents a decrease of 12.2% after 552,317 tonnes in March and a 5.1% increase from April 2020.
The year-on-year increase in input imports came as logistics clearance delays caused by shortages of cargo containers and high shipping rates began to decline, said He Tianyu, CRU analyst.
“From mid-April, the problem began to subside because more cargo hit the Chinese market. But in early April there were still some delays in logistics, especially from South America, Japan and South Korea.”
The analyst said shipments delayed from January to February would arrive in March and April, and that May arrivals could also remain high, and imports would return to 2019 levels starting in June.
In April, activity in China’s manufacturing sector grew at a slower pace than expected because rising costs costed on production.
April imports of copper concentrate, or partially processed copper ore, totaled 1,921 million tonnes, below the March record of 2,171 million tonnes, and 5.3% below 2,029 million tonnes in April 2020. (Report by Shivani Singh and Tom Daly, additional report by Mai Nguyen in Hanoi; Edited in Spanish by Janisse Huambachano)
