SCCO - Copper other base metals slide as China's demand recovery disappoints

2023-04-25 08:57:49 ET

Copper prices tumbled to five-week lows Tuesday in the wake of a weaker than expected rebound in demand from China and rising inventories in the London Metal Exchange warehouse system.

On-warrant copper stocks in LME-registered warehouses reportedly rose by 7K metric tons to 57K tons, the highest level since mid-January.

According to Reuters , benchmark LME copper ( HG1:COM ) recently was -1.9% to $8,563.50/metric ton, a fifth straight daily loss and down ~$1K from a YTD high of $9,550 in January.

ETFs: ( NYSEARCA: COPX ), ( CPER ), ( JJC ), ( JJCTF )

Freeport McMoRan ( NYSE: FCX ) -2.5% pre-market; also on watch will be Southern Copper ( SCCO ), Teck Resources ( TECK ), Hudbay Minerals ( HBM ) and First Quantum Minerals ( OTCPK:FQVLF ).

LME aluminum ( LMAHDS03:COM ) was -2.2% to $2,329/metric ton, also down sharply from a January peak, while lead, zinc, nickel and tin all traded lower.

Citi analysts said aluminum smelters in China's Yunnan province, which already have cut production capacity by ~2M tons/year, may need further reductions because of drought.

Alcoa ( AA ) -2.7% , Kaiser Aluminum ( KALU ) -4.1% pre-market on Tuesday.

Freeport McMoRan ( FCX ) recently reported Q1 earnings and sales that fell sharply from the year-earlier quarter .

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