Copper and iron ore prices are facing a tough week as they head for their worst losses since 2022. The lack of stimulus measures from a recent policy meeting in China has left investors worried about the demand for these metals.
Futures for copper have dropped almost 5% in London, with other metals like aluminum, tin, and nickel also experiencing declines. The stronger US dollar and a shift away from risk assets have further dragged down the complex. Iron ore futures in Singapore have fallen below US$104 a tonne.
The concerns over the demand for copper, which is used in various industries such as pipes, wiring, and batteries, stem from China’s slowing growth rate. The recent third plenum meeting of Communist Party officials in Beijing did not offer any major steps to boost demand or address the property market crisis.
Global copper inventories have surged in recent months, putting further pressure on prices. The situation is also being exacerbated by a major earthquake in Chile, a key copper and lithium mining region.
Despite a slight rebound in copper prices on the London Metal Exchange, the overall sentiment remains bleak. Aluminum and tin prices have also taken a hit, leading to a sell-off in mining shares. Iron ore prices in Singapore have dropped to US$103.70 a tonne, driven not only by China’s demand outlook but also by reports of increased production from major miners.
As the metals market continues to face challenges, investors are closely watching for any signs of recovery or further disruptions in the coming weeks.
