LONDON- Copper prices came under pressure from a stronger dollar on Friday, but losses were limited due to London Metal Exchange (LME) data showing rising amounts of metal waiting to leave its registered warehouses.
Consumers, producers and traders use the LME as a market of last resort. They deliver surpluses to LME warehouses and take metal out of the system when they are short.
Benchmark copper on the LME was down 0.5 percent at $9,048 a metric ton.
LME data shows copper stocks in its warehouses rising 4,400 tons to 272,825 tons. But cancelled warrants — metal earmarked for delivery — jumped 8,950 tons taking the total to 16,650 tons.
Most of that cancelled metal is in LME warehouses in Kaohsiung, Taiwan. Traders say it is headed for top consumer China, where imports of copper and products in November hit a one-year high.
Meanwhile copper stocks in warehouses monitored by the Shanghai Futures Exchange (ShFE) have been sliding, suggesting rising demand. At 84,557 tons, they have nearly halved since the middle of October.
“The market is looking at the cancelled warrants and copper stocks in Shanghai,” a copper trader said, adding that the dollar would continue to weigh on prices of industrial metals.
