Copper Prices Suffer Trade War Sell Off
The price of copper fell this week to 2.80 U.S. dollars a pound amid U.S. protectionist tariff moves, the Chilean Copper Commission (Cochilco) said on Friday.
Such moves “undercut expectations of a quick recovery in the price of the metal,” Cochilco said.
As Chile’s main export product, copper was selling for 2.84 U.S. dollars a pound on the international market last week.
Workers at Chile’s Escondida copper mine went on strike on Thursday to demand a better contract.
“The agents of the copper market are looking more at the risks associated with demand rather than with supply,” the commission said.
According to Cochilco, metal exchange inventories “are rapidly shrinking” while the strikes threaten to create “a copper shortage.”
Metal exchange inventories currently stand at 628,622 metric tons of copper, or 1.8 percent less than last week. The dip affected all three existing metal exchanges, with the biggest decrease registered in Asian warehouses.
COPPER: Three-month copper on the London Metal Exchange traded down 1.3 percent in official midday rings at $6,090 a tonne, having earlier hit a two-week low of $6,066. Copper posted its biggest monthly fall last month since December 2016.
FED: The US Federal Reserve kept interest rates unchanged on Wednesday but described the economy as strong, keeping the central bank on track to increase borrowing costs in September and boosting the dollar.
ALUMINA: The city of Chaoyang in China has cancelled a planned $3.4 billion alumina project after a public consultation. The plant would have supplanted Norsk Hydro’s Alunorte project in Brazil as the world’s biggest alumina refinery.
PHILIPPINES: The Philippines confirmed on Thursday that 23 of 27 mines reviewed for compliance with state regulations will continue to operate, while the remaining four in the world’s No. 2 nickel supplier that failed the audit could face closure.
OTHER METALS: Aluminium was last bid down 0.3 percent in rings at $2,046 a tonne, zinc traded up 0.5 percent at $2,568, lead was last bid up 1.3 percent at $2,153, tin traded down 0.8 percent at $19,675 while nickel was last bid down 2 percent at $13,325.
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