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Morning Copper Markets

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Morning Copper Markets

 

 

Copper Stockpiles Hit 21-Month High Amid Rare China Exports

Copper stockpiles on the London Metal Exchange have reached a 21-month high, marking the highest level since October 2021, currently standing at 195,475 tons. This increase, which saw a 2.3% rise on a single day, is attributed to deliveries from Korea and Taiwan, key points for metal flowing from China. Despite traditionally being a significant importer, China has seen a surge in copper exports this year due to a mismatch between its smelter output and weakened demand from its manufacturing and construction sectors. This shift has contributed to a 90% increase in LME copper inventories since early May. Concurrently, stockpiles on the Shanghai Futures Exchange have also risen, with no significant drawdown in Chinese inventories during the peak demand period. This accumulation of stockpiles poses a challenge to the market, despite a significant price rally this year. Copper prices have recently seen a decline, with a 0.5% drop to $9,824 per ton on the LME, though they remain 15% higher year-to-date, ranking copper as the second-best performer after tin on the LME.

European Miners Drop for a Fourth Day as Iron Ore, Copper Slip

European mining stocks experienced a decline for the fourth consecutive day, marking the longest losing streak since January, as reflected in the Stoxx 600 Basic Resources Index which dropped by 0.3% early in the London session. Leading the downturn were significant players such as Rio Tinto, which fell by 0.5%, making it the most substantial negative influence on the index. Other notable declines were recorded by Glencore, BHP Group, KGHM, Boliden, and Antofagasta. The sector's slump was driven by negative developments in China, where ongoing losses among steel mills and developers, coupled with discouraging inflation data, signal persistent economic challenges. This environment has particularly impacted iron ore, which saw a significant reduction of 3.6% in its futures, settling at $105.45 a ton. Similarly, copper prices decreased by 0.2% to $9,850.50 a ton after the release of data indicating continued deflationary pressures in China, dampening the demand outlook in the world's largest copper market.

BHP Entrusts Rising Star with Its Copper Mines

Anna Wiley has recently been appointed as BHP's asset president for copper in South Australia, a significant leadership role tasked with integrating and expanding the copper mines acquired from OZ Minerals. This role is critical in increasing production by 50%, aiming to achieve over 500,000 tonnes annually. Wiley's career trajectory includes strategic positions at Rio Tinto and significant involvement in BHP's decarbonization strategy, emphasizing the importance of copper in reducing emissions. Her recent efforts focus on integrating operations across BHP's South Australian mines, enhancing copper concentrate delivery from Carrapateena and Prominent Hill to Olympic Dam. Wiley is also exploring the potential development of the Oak Dam prospect into a new mine. Beyond her professional accomplishments, Wiley is actively involved in promoting a culture of collaboration and inclusivity within her teams.

Macroeconomic Data

image-20240710080541-1image-20240701082431-1image-20240628082002-2​​

Sources: Bloomberg, StoneX

Copper Prices and Spreads

image-20240710080558-2image-20240701082431-2

Sources: Bloomberg, StoneX

Comex Active & LME 3M – 3 Day Price Trend

image-20240710080622-3image-20240701082431-3

Sources: Bloomberg, StoneX

Comex Active Month – 6 Month Price Trend

image-20240710080656-4image-20240701082431-4

Sources: Bloomberg, StoneX

LME Rolling 3M – 6 Month Trend

image-20240710080737-5image-20240701082431-5

Sources: Bloomberg, StoneX
Related tags: Base Metals

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