Copper Prices Rise on Anticipated Strategic Reserves Expansion in China
Copper prices in London increased slightly after a report indicated China is planning to expand its strategic reserves of key industrial metals, including copper, cobalt, nickel, and lithium. The dollar’s strength impacted metal prices, with varied performance across different metals on the exchanges.
On Friday, copper prices in London experienced a modest increase, approaching the significant level of $10,000 per metric ton. This uptrend follows a report indicating that China intends to increase its strategic reserves of essential industrial metals this year, including copper, cobalt, nickel, and lithium. The National Food and Strategic Reserves Administration, which oversees these stockpiles, conducted price inquiries for the mentioned metals, according to Bloomberg News, although specific details regarding volumes and timelines were not disclosed.
As of 0303 GMT, the benchmark three-month copper on the London Metals Exchange (LME) rose by 0.3% to $9,970 per metric ton. A trader noted that the announcement concerning strategic buying had minimal immediate impact on metal prices due to the absence of comprehensive details. Meanwhile, the U.S. dollar strengthened, supported by the Federal Reserve’s lack of immediate plans to lower interest rates, with the dollar index improving by 0.03 to 103.82.
The firm U.S. dollar renders dollar-priced metals more expensive for international buyers using other currencies. Besides copper, other metals on the LME saw varied changes: aluminum rose by 0.3% to $2,666 per ton, lead increased by 0.1% to $2,057.5, zinc gained 0.5% to $2,932, while tin saw a slight dip of 0.1% to $35,310, and nickel declined by 2.0% to $16,240.
In Shanghai, SHFE copper climbed 0.2% to 81,540 yuan ($11,252.64) per ton, while SHFE aluminum remained unchanged at 20,845 yuan. Zinc rose 0.6% to 23,895 yuan, lead fell by 0.5% to 17,590 yuan, and nickel decreased by 0.3% to 129,890 yuan. Tin saw a notable increase of 1.0% to 281,620 yuan.
In conclusion, copper prices rose slightly following a report of China’s plans to enhance its strategic reserves of key metals. Despite this upward movement, the impact on prices was limited by a lack of detailed information. Concurrently, the strengthening U.S. dollar influenced the pricing dynamics of metals, with varied performances observed across different metals on the LME and SHFE markets.
Original Source: www.tradingview.com
