Copper prices rose on Tuesday as falling inventories in exchange warehouses and hopes for stimulus in China offset concerns over tepid demand in the world’s biggest metals consuming market.
Three-month copper on the London Metal Exchange was up 0.8 percent at $8,459.50 per metric ton, while the most-traded July copper contract on the Shanghai Futures Exchange edged up 0.2 percent at 68,610 yuan ($9,511.86) per metric ton.
The premium of LME cash copper over the three-month contract rose to $31 a ton, a level unseen since November last year, indicating tightening nearby supplies.
On-warrant copper inventories fell to 25,725 tons, the lowest level since October 2021. Inventories of the metal in SHFE and Chinese bonded warehouses have also been declining.
“While LME copper prices remain under pressure given concerns over Chinese demand and a more hawkish Fed, LME copper spreads continue to strengthen, reflecting some tightness in the prompt market,” ING analysts said in a report.
Floods in top copper producer Chile saw some mining disruption and supported prices.
Premier Li Qiang said China will launch “effective measures” to grow demand, and economic growth in the second quarter will be higher than the first and is expected to reach the annual target of around 5 percent.
LME aluminum rose 1.2 percent to $2,174.50 per metric ton, nickel increased 2.5 percent to $20,805, zinc advanced 1.8 percent to $2,369, lead was up 1 percent at $2,090.50 and tin climbed 1.8 percent to $26,100.
SHFE aluminum increased 0.6 percent to 18,295 yuan per metric ton, zinc advanced 0.8 percent to 20,190 yuan, while nickel fell 1.3 percent to 162,280 yuan, lead declined 0.7 percent to 15,495 yuan and tin shed 0.5 percent to 213,160 yuan.
