MUMBAI, 8 Aug (Commoditiescontrol): Copper prices saw a modest increase on Thursday, supported by a weaker U.S. dollar, although rising inventories and a bleak global growth outlook continued to exert downward pressure.
On the London Metal Exchange (LME), three-month copper edged up by 0.1% to $8,778.50 per metric ton by 0323 GMT. Despite this slight gain, the contract has experienced a 4.7% decline so far this month, marking consecutive monthly losses since June. The weakening dollar made commodities priced in greenbacks cheaper for holders of other currencies, providing some support to copper prices.
Conversely, the most-traded September copper contract on the Shanghai Futures Exchange (SHFE) fell by 0.8% to 70,930 yuan ($9,889.02) per ton, mirroring the losses seen on the LME in the previous session.
The global economic growth cycle has turned downward, suggesting that all markets might move in unison. According to an industry observer, the increase in visible stocks and recovering treatment and refining charges (TC/RCs) leaves copper bulls with little to support their optimism. The rise in TC/RCs, which are the fees smelters charge miners to process raw materials, indicates an improvement in the supply of copper concentrate on the spot market, which has been tight and a factor for bullish sentiment in the past.
LME copper inventories have surged nearly threefold in less than three months, reaching 294,750 tons on Wednesday. Recent deliveries to LME warehouses in South Korea and Taiwan, the closest locations to China, contributed to this increase.
In other metals on the LME, aluminum dropped by 0.6% to $2,274 per ton, nickel fell by 0.9% to $16,145, lead decreased by 0.6% to $1,955.50, tin declined by 0.8% to $29,765, while zinc remained nearly flat at $2,582.50.
On the SHFE, aluminum eased by 0.2% to 18,920 yuan per ton, nickel declined by 1.5% to 127,430 yuan, zinc fell by 0.5% to 21,895 yuan, while lead increased by 0.1% to 17,345 yuan, and tin rose by 0.5% to 245,660 yuan.
(By Commoditiescontrol Bureau; +91 98201 30172)
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