On Monday, copper prices went down amid improved volumes in storage after the London Metal Exchange (LME) emphasized improved supply.
Copper futures for July delivery decreased by -0.14% to $3.88 per pound on June 19’s Asian afternoon session.
Data from LME showed that the metal dropped after 16,350.00 tons of it arrived in the warehouses. As a result, the total stocks had a 14.00% boost.
This year, the commodity is anticipated to reach a global market surplus of 240,000.00 metric tons. In 2022, it faced a deficit of 180,000.00 tons, as said by experts.
On the other hand, research analysts said that any price improvement would lead to flushing out any surplus metal. They added that people can expect metal like copper to pop up anywhere.
As for another bullish factor, the LME metal bounced back by 10.00% from its lowest level on May 24. In addition, experts said that higher prices among other base metals would be hard to explain. Speculators primarily drove them.
Also, a fire from a smelter in Sweden caused issues that brought advantages to copper costs. Moreover, stocks on the Shanghai Futures Exchange dropped by 20.10% in the week. It fell by 70.00% from a high February record, but Chinese consumption remained subtle.
Demand Uncertainty Dragged Copper Down
London copper prices retreated while investors determined the outlook of the metal due to high production. China is the top producer and consumer of the commodity.
The most significant auto market globally is anticipated to release policy measures in the following days. It would promote the development of its new-energy vehicle industry.
Furthermore, the improved copper production in China may hit 1.10 million tons, a record monthly high. Despite some scheduled maintenance, the high output is forecasted to last until July.
According to some analysts, there is little room for lowering prices due to the lesser stock in SHFE. Also, domestic supplies would stay tight since there are importing issues.