NEW YORK (Reuters) – London Metal Exchange (LME) copper futures ended lower on Tuesday after touching a three-year high on Tuesday, as US factory orders were weak and dragged down to soften base metals.
China’s strong demand, the dollar weakness and supply worries and other factors to stimulate a wave of speculative buying, copper, aluminum, nickel and zinc prices are approaching years high.
“The market may hit short-term tops and some funds leave,” said Robin Bhar, head of metal research at Societe Generale.
He said: “But in the past few months each time you can fall back to a good buying.”
London time on September 5 17:00 (Beijing time on September 6 00:00), LME three-month copper fell 0.2 percent, to $ 6,901 per ton, earlier touched in September 2014 to the highest $ 6,970, Approaching the key psychological barrier $ 7,000.
Demand for strong metal consumer demand in China is expected to support copper prices rise. China’s manufacturing growth accelerated in August and is expected to remain strong by the end of this year.
But the United States in July factory orders recorded the biggest decline in nearly three years.
With copper prices rising for the ninth consecutive week, trend funds and speculators bet prices will continue to rise, COMEX copper long positions last week to record highs.
US Commodity Futures Trading Commission (CFTC) data released Friday showed that as of August 29 the week, speculators holding copper futures and options net long positions 2,796 hands to 124,929 hands, which is at least the highest since 2006 records Level.
German commercial bank analyst Daniel Briesemann said metal prices could go further, but he warned that the market had been out of supply and demand fundamentals and that copper could be trimmed below $ 6,000 per tonne.
LME copper stocks to reduce support prices, data released on Tuesday, LME copper warehouse receipts fell to 11.145 million tons, from mid-July to reduce about half.
Standard Chartered analysts say Indonesia has agreed with freeport, Freeport McMoRan Inc, to allow the free port to continue to operate its Grasberg copper mine, which has improved the copper supply outlook or the price structure drag.
China Yunnan Province Safety Production Committee Office recently issued “Yunnan Province in 2017 steel and electrolytic aluminum industry to carry out safety production law enforcement special action to promote backward production capacity exit program.” “Work program” proposed, the normal production of iron and steel enterprises in Yunnan Province and electrolytic aluminum enterprises to carry out safety production law enforcement special action to list the list of problems and risks, clear its safe production conditions, and urge the iron and steel enterprises to carry out security risks rectification, With the conditions of safe production, and comprehensively enhance the level of intrinsically safe, to achieve safe and healthy development; do not have the conditions of production safety conditions, in the end of December 2017 before the rectification or rectification is still unqualified, all the local government to bring the law to close off; For the basic safety of production conditions, but there are problems and risks through the deadline for rectification is still not up to the standard production capacity, all reported to the relevant departments to implement the differential price, ladder price, punitive tariffs and ultra-fixed water progressive fare increase and other different energy resources prices, And electrolytic aluminum industry backward and non-compliance capacity to exit.
Yunnan’s aluminum smelting capacity is about 1.7 million tons / year.
Philippine President Dutterter said Tuesday he agreed to ban open-pit mining because it caused environmental damage, but would give miners time to find other ways to extract minerals. The Philippines is the world’s largest exporter of nickel ore, the decline in nickel production in the Philippines gave nickel prices to support.
Among other base metals, aluminum closed down 1.1 percent at $ 2,096 a tonne.
Three-month zinc fell 2 percent at $ 3,140 a tonne.
Three-month tin futures were down 0.3% at $ 20,730 a tonne.
Three-month nickel fell 1.4 percent to $ 12,080 per tonne.
Three-month lead fell 2.5% to $ 2,330 a tonne.
