Abitibi Metals boosts resource by 62% at B26 polymetallic deposit in Quebec
Indicated resources increased to 11.3 million tonnes from 6.9 Mt.
Citigroup Inc. cut its short-term outlook for copper prices by 11% as likely hikes in US trade tariffs under a Trump presidency and weaker-than-expected China stimulus would weigh on demand.
“Former President Donald Trump’s election for a second term marks a clear turning point in global trade tariff policy,” analysts at Citigroup wrote in a note. “And China’s lack of easing to date has surprised us.”
The bank sees prices dropping to $8,500 a ton over the next three months from its previous forecast of $9,500. The industrial metal has already slumped by nearly 10% since late September.
A resurgence in the dollar in anticipation of potentially inflationary policies that could limit US interest-rate cuts helped drive copper’s decline. A stronger greenback typically puts pressure on commodities priced in the currency.
A gauge of the dollar’s strength against a basket of currencies jumped Wednesday, extending the recent election-driven rally, after US inflation data showed the rate of price increases remained firm in October.
China also needs to deploy more economic stimulus if copper demand is to revive, according to a manager at Eagle Metal International Pte, which handles roughly 10% of refined copper imports to the country. Thus far the government has focused on the much-needed restructuring of local government debt, but stopped short of stimulus measures that would directly boost domestic demand.
Copper futures fell on the London Metal Exchange Wednesday, after the so-called core consumer price index — which excludes food and energy costs — increased 0.3% for a third straight month.
Copper futures dropped 1.1% to $9,038.00 a ton on the LME at 3:38 p.m. London time. Aluminum and nickel fell, while zinc rose.
(By Jack Ryan)
Read More: China’s copper production boom threatens to crowd out the rest of the world
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