Abitibi Metals boosts resource by 62% at B26 polymetallic deposit in Quebec
Indicated resources increased to 11.3 million tonnes from 6.9 Mt.
Copper resurfaced above its $7,500 per ton plunge as fears of a global economic slowdown piled pressure on industrial metals and deepened their dive from record highs just months ago.
Investors are fretting over a range of threats to demand, from Europe’s gas crisis to a US slowdown and renewed virus flare-ups in China. After a 4.2% slump on Tuesday to its lowest close in 19 months, copper fell almost 5% on Wednesday, before paring some losses. Aluminum climbed while nickel and tin sank.
“Copper’s caught a bit of a bid that’s lifted it off the lows, but we’re certainly expecting more downside,” Geordie Wilkes, head of research at Sucden Financial Ltd., said by phone from London. “We’re not in a recession yet but we’re certainly seeing slower growth, and so there aren’t any real prospects for copper to rally meaningfully from here.”
The last quarter was the worst for metals since the financial crisis in 2008, and July has brought little relief as fears of a recession dominate markets. It’s a rapid turnaround from March, when the LMEX Index of six metals soared to an all-time high amid fears that Russia’s attack on Ukraine would fuel shortages.
A fresh round of mass virus testing in Shanghai underscored concerns that China’s Covid Zero policy will complicate the recovery for the world’s second-biggest economy. The country was seen as one of the brighter spots for demand, given government pledges to reboot growth this half.
Meanwhile, US policy makers backed raising rates at their next meeting in July by either 50 or 75 basis points, according to minutes of the Federal Open Market Committee’s June 14-15 policy meeting released Wednesday in Washington. The chances of a US economic contraction are now 38%, according to the latest forecasts from Bloomberg Economics.
“There is no bullish news at the moment, really,” Fan Rui, an analyst with Guoyuan Futures Co. said by phone. “Europe, US are facing risks of recessions and can hardly contain inflation, which will lead to monetary tightening that is bearish for copper, while in China, the economy is facing a double blow from the flare-up of new cases and a weaker-than-expected demand recovery.”
Copper closed 2% down at $7,520.50 a ton at 5:11 p.m. in London. Aluminum gained 0.7% alongside lead’s 1.6% climb. Nickel dropped 3.5% as tin fell 5%.
(By Andrea Bossi and Mark Burton)
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