“The constraint is the employment issue, but I don’t see China fighting too hard to sustain an industry which is high-cost, uncompetitive and deeply polluting”, he said.
The global world refined copper market showed an 81,000-tonne surplus in August, compared with a 3,000-tonne deficit in July, the International Copper Study Group said.
“Any policy support from the government and smelters, including the reported investigation on short-selling, subsidies to smelters or joint production cuts, will be short-lived forces and won’t change the bigger picture of a market glut”, said Qi Ding, a Beijing-based analyst at Essence Securities Co.
Zinc for delivery in three months climbed 2.1 per cent to $US1611.50 a metric ton by 5.18pm on the London Metal Exchange. On the zinc stockpiling, an official from China Nonferrous Metals Industry Assn (CNIA) lead and zinc branch told Metal Bulletin that he was not aware of any zinc stockpiling plan.
The gains, though, could be short-lived, even if China does turn out to be buying. Nickel is used in manufacturing stainless steel.
COPPER prices have bounced to their highest level in almost two weeks as the United States dollar’s uptrend faltered and funds started to reverse some of their bets on lower prices. Copper slipped 0.7 per cent to end at $US4,580 a tonne, after hitting a fresh six-and-a-half-year low of $US4,561.
Oil was not spared, with USA crude sliding as much as 2.2 percent, while gold came close to a near 6-1/2-year trough as a looming US interest rate hike and a resultant firm dollar continued to blunt the bullion’s safe-haven appeal. Though if the market thinks “that they’re just creating higher stocks, that could be negative for prices in the medium term”.
In a sign of a possible boost in future demand, China is offering $10 billion in infrastructure loans to Southeast Asian countries, a senior Chinese foreign ministry official said on Sunday. Aluminium was up 1.4 percent at $1,480, tin gained 1.1 percent to $14,905 and lead rose 1.8 percent to $1,644 a tonne.