METALS-Copper slips on poor demand prospects

By Reuters / December 29, 2022 / / Article Link

(Updates prices) By Pratima Desai LONDON, Dec 29 (Reuters) - Copper prices slipped onThursday as surging COVID infections in top consumer China andworries about a global recession fuelled fears of slowing demandfor industrial metals. Benchmark copper on the London Metal Exchange (LME)was down 0.2% at $8,428 a tonne at 1704 GMT. Prices of the metalused widely in the power and construction industries touched atwo-week high of $8,520 on Wednesday. "We will be entering 2023 with markets trying to gauge thedemand impact from slowing global growth. It is clear that anumber of key economies will enter recession. The big questionis how severe," ING head of commodities Warren Patterson said. "When you couple these concerns with the ongoing weakness inChina it is likely that demand will continue to dictate pricedirection through the early part of 2023," Patterson said. China's lifting of restrictions, following widespreadprotests against them, means COVID is spreading largelyunchecked and likely infecting millions of people a day,according to some international health experts. Clues to demand prospects for copper and other industrialmetals will come from surveys of purchasing managers in China'smanufacturing sector, released over the next few days. Technically, copper faces upside resistance around $8,510where the 200-day moving average sits currently, while supportis provided by the 21-day moving average at $8,380. Elsewhere, lead prices rose 2.3% to $2,270 a tonneafter hitting $2,302.5 on Wednesday, the highest since May 5. Funds were buying LME lead, anticipating higher prices ofthe battery material ahead of its inclusion in the BloombergCommodity Index (BCOM) in early January for the first time,metals traders said.

Worries about supplies and historically low stocks have also helped push prices of the battery metalup nearly 30% since Sept. 29. Cancelled warrants at 44% of total lead stocks at 25,150tonnes and large holdings of warrants and cash contracts suggest that stocks will fall further over comingdays. In other metals, aluminium gained 1.2% to $2,410 atonne, zinc fell 0.9% to $2,977, tin advanced1.1% to $25,015 and nickel ceded 1.1% to $30,100. (Reporting by Pratima Desai; Editing by EmeliaSithole-Matarise, Elaine Hardcastle and Mark Porter)

LME price overview COMEX copper futures All metals news All commodities news Foreign exchange rates SPEED GUIDES )) Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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