Copper prices weakened on Tuesday, pressured by investor disappointment that China failed to ease its strict COVID-19 policy while a global economic downturn is dampening metals demand.
Three-month copper CMCU3 on the London Metal Exchange (LME) shed 1.3% to $7,462 a tonne by 1020 GMT.
Copper has given up 30% since touching a record peak in March but has largely held in a range between $7,200 and $8,000 since the end of August.
“The macro headwinds continue to mount. The markets have a lot to face over coming months and today the dollar is stronger, so that’s an additional headwind,” said independent consultant Robin Bhar.
“The market was looking for some positive inputs and so far it hasn’t come from China, since there wasn’t any mention of moving away from the zero-COVID strategy.”
Chinese President Xi Jinping reiterated the validity of China’s zero-COVID policy at the Communist Party Congress. Some market participants had hoped that China would ease its curbs, which include lockdowns and movement curbs.
The most-traded November copper contract SCFcv1 on the Shanghai Futures Exchange (ShFE) closed 0.9% lower at 62,650 yuan ($8,714.82) a tonne.
The Shanghai copper front-month November contract’s SCFc1 premium over the second-month December contract SCFc2 fell to 870 yuan a tonne from a 13-year high of 1,950 yuan on Friday, indicating easing tightness of immediately available metal.
ShFE copper inventories CU-STX-SGH rose sharply on Oct. 14, but tight overall supply in China continued to lend support and cushion prices from steep falls.
“The (Chinese copper) consumer side is expected to remain resilient … It is expected that the tight spot pattern will continue until mid-November,” Jinrui Futures said in a note.
More inflows of aluminium into LME warehouses weighed on LME prices CMAL3, which lost 0.8% to $2,211.50 a tonne.
LME aluminium inventories have shot up 46% this month, LME data showed.
Among other metals, LME nickel added 0.2% to $21,575 a tonne and tin rose by 0.5% to $19,740, but zinc edged down 0.1% to $2,864.50 and lead dipped by 0.1% to $2,024.50.
Source: Reuters (Reporting by Eric Onstad Additional reporting by Mai Nguyen in Hanoi Editing by David Goodman )