Copper Prices Rise Following China’s Strategic Stockpiling Announcement

Copper prices increased slightly in London, nearing $10,000, after reports that China plans to expand its strategic reserves of various industrial metals. While prices fluctuated, the influence of the U.S. dollar and a lack of details in the strategic buying news tempered the market’s response.

On Friday, copper prices in London saw an increase, nearing the psychological level of $10,000. This rise was prompted by recent reports that China intends to expand its strategic reserves of essential industrial metals, including cobalt, copper, nickel, and lithium. Reports from Bloomberg News indicated that the National Food and Strategic Reserves Administration had been making price inquiries and bids for these metals, though specific details regarding volumes or timing were not disclosed.

As of 0303 GMT, the benchmark three-month copper price on the London Metals Exchange (LME) rose by 0.3%, reaching $9,970 per metric ton. A trader noted that the news of strategic buying did not significantly influence metals prices due to the lack of detailed information.

The U.S. dollar strengthened, buoyed by indications from the U.S. Federal Reserve that there is currently no intention to lower interest rates. The dollar index increased by 0.03 to 103.82 as of 0238 GMT, following a rise of 0.36% the previous day. A stronger dollar renders dollar-priced metals more expensive for buyers using other currencies.

In the LME, aluminum prices increased by 0.3% to $2,666 per ton, lead rose by 0.1% to $2,057.5, zinc experienced a gain of 0.5% to $2,932, while tin decreased slightly by 0.1% to $35,310. The price of nickel decreased by 2.0%, landing at $16,240 per ton.

On the Shanghai Futures Exchange (SHFE), copper climbed by 0.2% to 81,540 yuan ($11,252.64) per ton. Meanwhile, SHFE aluminum remained stable at 20,845 yuan per ton, zinc rose by 0.6% to 23,895 yuan, lead declined by 0.5% to 17,590 yuan, and nickel lost 0.3% to 129,890 yuan. Tin prices, however, saw a gain of 1.0%, reaching 281,620 yuan.

In summary, copper prices have risen in London following reports of China’s plans to expand its stockpiles of crucial industrial metals. However, the lack of specific details on these plans has muted the impact on metal prices. Furthermore, the strengthening dollar continues to influence market dynamics, making metals more expensive for purchasers using other currencies. The overall market remains cautious amid evolving global conditions.

Original Source: www.tradingview.com