Copper price rises following good outlook for Chinese demand
The price of copper climbed for the fourth day as China’s success in containing a sprawling covid-19 epidemic boosted confidence in the demand outlook.
Physical market indicators suggest that the country’s appetite for copper is accelerating rapidly.
Copper for September delivery was up 1% from Tuesday’s settlement price, reaching $ 4.3025 per pound (9,465 per tonne) in the New York Comex market.
There are also signs that last week’s price drop is encouraging consumers to return to the market, while simultaneously discouraging scrap copper suppliers from making sales.
At the end of last week, high-grade copper scrap in China was trading above the refined metal, indicating that the supply of scrap had quickly dried up, according to BMO Capital Markets. In turn, high scrap prices and lack of availability could stimulate demand for refined metal.
“This dynamic is obviously unusual and doesn’t make economic sense, but it’s a sign that the sell may be above fundamentals,” Colin Hamilton, managing director of commodities research at BMO, told Bloomberg. .
“We have the first signs that Chinese buyers have stopped destocking and are coming back to the market.
