Copper prices rose 0.44% yesterday, finishing at 769.3, boosted by optimistic signs from China, the world’s largest purchaser of metal. This increase signals a potential resurgence in the sector, which has faced hurdles due to low demand in China’s industrial sector.
Furthermore, the prospect of reduced supply as Chinese copper smelters consider cooperative output reduction amid lower ore supplies fueled the optimistic attitude.
However, despite these positive elements, concerns over raw material availability remain, since industries’ muted bidding resulted in a considerable increase in copper stocks. The Yanghsan copper premium is likely to fall precipitously, reflecting decreased demand for physical copper from industries.
In January, the International Copper Study Group recorded an 84,000 metric tonne surplus in the global refined copper market, up from 27,000 metric tonnes in December. When corrected for inventory fluctuations in Chinese bonded warehouses, this surplus suggests a tighter market than the prior month.
