China’s unusually large copper stockpiles fuel demand concerns
China’s copper inventories are growing at exactly the time of year when they should be shrinking fast — an anomaly that underscores concerns about demand in the world’s biggest market.
Stockpiles of the metal held in Shanghai Futures Exchange warehouses ended last week well above 300 000 t. That’s not the biggest volume ever, but it is the most for any end-of-May date on record. In China’s highly seasonal economy, inventories typically peak in March and slide lower as factories ramp up activity heading into the summer.
Recent data on Chinese manufacturing has painted a mixed picture. The official factory gauge for May slipped into contraction, while a private survey — more focused on smaller and export-oriented firms — showed a modest improvement.
The rise in China’s inventories reflects what some analysts see as a divergence between the global mood on copper, which hit a record above $11,000 a ton last month on fears of a looming shortage, and poor demand from Chinese processors of the metal.
Recent trading suggests that weak Chinese conditions, which revolve around a slowing economy and a protracted crisis in the housing sector, have begun to weigh more heavily on the market. Prices on the London Metal Exchange are now below $10 000 — an unwinding of “excessive optimism,” according to Capital Economics.
There are plenty of other indications that Chinese demand is suffering. Buyers of imported copper are now able to demand a discount, rather than the typical surcharge, on international prices, with the the so-called Yangshan premium dropping to negative levels since last month.
Comments
Research Reports
Projects
Latest Multimedia
Latest News
Showroom
Introducing the Rio-Carb Smart Chute Concept - a revolutionary advancement in materials handling, designed for the toughest industries like mining...
VISIT SHOWROOM
Rentech provides renewable energy products and services to the local and selected African markets. Supplying inverters, lithium and lead-acid...
VISIT SHOWROOM
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation
