Copper prices have reversed earlier gains, with market focus returning to signs of softening demand, according to ANZ analysts. Fresh indications of this trend emerged on Wednesday as inventories increased in London Metal Exchange warehouses across Asia, suggesting potential for further supply gains. Additionally, copper traders capitalised on a short-lived arbitrage window last week by moving extra spot cargoes from Africa into the Chinese market, spurred by a surge in Shanghai futures that outpaced gains in London benchmark prices.
Adding to the bearish sentiment, the China Nonferrous Metals Industry Association has forecast a roughly 5 per cent increase in the country’s refined copper output this year, following a 10 per cent surge the previous year. This projection has further dampened enthusiasm among investors, overshadowing initial positive reactions to calls for increased strategic reserves.
Earlier, copper prices briefly surged following a call from the state-owned industry group urging authorities to boost strategic reserves of the metal and for Chinese manufacturers to build up commercial stockpiles. This suggestion mirrors recent moves by the Trump administration, which unveiled plans to establish its own critical minerals strategic reserve, supported by a $US10 billion fund aimed at procuring and storing minerals for various manufacturers.
The China Nonferrous Metals Industry Association is an organisation that focuses on the nonferrous metals industry in China. It aims to promote the development and coordination of the sector, while also providing guidance and support to its members.
