After the market fell to its lowest point since late November due to worries about demand in China, copper prices yesterday finished up by 1.08% at 723.2 with bargain-buying bolstering the prices. The latest in a string of disappointing numbers, China’s April industrial output and retail sales growth fell short of expectations. Property investment and sales were down, and the metals-intensive manufacturing sector shrank in April.
The president of a union representing supervisors at Antofagasta’s (LON: ANTO) Centinela copper mine in Chile said the union and the company were “very far” from reaching a deal to prevent a strike. After rejecting the company’s most recent formal proposal last week, 97% of the union’s members decided to strike instead of continuing the five-day government mediation process.
As government measures to stabilize the sector improved confidence following the nation’s unexpected exit from COVID controls late last year, new home prices in China increased for the fourth consecutive month in April, but at a slower rate, according to official data released on Wednesday. According to the International Copper Study Group (ICSG), rising Chinese demand will drive this year’s anticipated deficit in the global copper market.
The ICSG predicted a shortfall of approximately 114,000 tonnes for 2023 as opposed to a surplus of approximately 155,000 tonnes anticipated in October, primarily as a result of improved predictions for Chinese demand. Technically, the market is under short covering as open interest decreased by -16.21% to settle at 4141 while prices increased by 7.75 rupees. Currently, copper is receiving support at 713.9 and a move below could result in a test of the 704.6 level, while a move above could result in prices testing 734.6.