Copper price edges down to two-week low amid demand uncertainty
The metal headed for a third daily decline, with copper miners also under pressure as a risk-off mood took hold in broader equity markets.
Copper prices retreated on Friday as demand worries rose after data showed factory activity in top metals consumer China slumped last month at the fastest pace in two years, with a firm US dollar also weighing on sentiment.
Copper for delivery in May fell 0.8% from Thursday’s settlement price, touching $4.724 per pound ($10,392 per tonne).
[Click here for an interactive chart of copper prices]
The most-traded May copper contract on the Shanghai Futures Exchange ended daytime trade 0.5% lower at 73,160 yuan ($11,514.55) a tonne, after ending March with its eighth straight quarterly gain.
Manufacturing conditions in China deteriorated in March amid the Ukraine crisis and a resurgence in domestic coronavirus cases that hit both external and domestic demand, mirroring the overall situation in Asia.
Shanghai’s strict lockdowns are threatening production at hundreds of factories in nearby industrial regions that rely on a steady flow of metal from China’s top commodities trading hub.
Trucking of base metals like copper and zinc in and out of warehouses in Shanghai, including those in the duty-free bonded zones, largely ground to a halt this week after the city’s government imposed tight curbs on the movement of people and vehicles, according to traders and logistics managers.
“The ongoing presence of covid-19 despite vaccinations is expected to continue to impact both the supply and demand side of the equation for base metals this year, with countries that practice zero tolerance, such as China, most at risk,” said Natalie Scott-Gray, senior analyst at broker StoneX.
(With files from Bloomberg and Reuters)
