Copper touches fresh low ahead of US, China trade talks
2 min read 08 May 2019, 05:01 PM ISTBenchmark copper on the London Metal Exchange was down 0.6% at $6,141 a tonne, its lowest since March 15 after firming in early tradeChina April trade surprises with export fall, import growth
PremiumLondon: Copper fell to a near three-month low on Wednesday on concerns over a potential resumption of tit-for-tat trade tariffs between the United States and China ahead of last-ditch negotiations.
US President Donald Trump's threat to increase tariffs on $200 billion worth of Chinese goods on Friday has raised the risk of an escalation in the trade spat between Washington and Beijing.
This could further slow the global economy while clouding the outlook for demand from top metals consumer China. The two sides will hold last-ditch talks in Washington on Thursday and Friday.
Benchmark copper on the London Metal Exchange was down 0.6% at $6,141 a tonne as of 1045 GMT, its lowest since March 15 after firming in early trade.
"We are not out of the woods as yet," said Saxo Bank analyst Ole Hansen, adding that volatility could be higher as the world's top economies resume talks.
Hopes that the Chinese government could introduce more stimulus to cushion any softness caused by fallout from the trade dispute supported prices, Hansen said.
"The market is of the belief that some kind of deal is in the interests of both parties but if there is a complete break down we could see some additional weakness," he said.
Meanwhile, China's April trade data painted a mixed picture of its economy, with exports shrinking unexpectedly while imports surprised with their first increase in five months.
Trade: Washington has accused Beijing of reneging on substantial commitments made during months of negotiations aimed at ending their trade war, prompting Trump to issue a Friday deadline to raise tariffs on Chinese goods.
Copper imports: China's unwrought copper imports rose 3.6% in April from the previous month, according to data released by the General Administration of Customs on Wednesday, as demand gathered momentum at the start of the peak-consumption second quarter.
Aluminium smelter: China's Henan Shenhuo Group commenced construction of an aluminium smelting project with an annual capacity of 900,000 tonnes in the southwestern province of Yunnan.
Chile: Copper production at Chile's top mines dropped sharply in the first quarter of 2019, Chilean copper commission Cochilco said on Tuesday due to operational issues, heavy rains and falling ore grades at the largest deposits.
Norsk: The incoming chief executive of Norsk Hydro will focus on improving the aluminium producer's profitability, aiming to present an improvement plan in the third quarter and review its rolled products division.
Prices: LME aluminium was 0.1% softer at $1,814 per tonne, zinc eased 1.2% to $2,659, lead climbed 0.7% to $1,870 while tin and nickel were steady at $19,405 and $12,045 respectively.
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