Commodity Blog

Commodity news, technical and fundamental analysis, market data on precious metals, energies, industrial metals, and soft commodities


Copper Rises to Three-Week High, Buoyed by Strong Chinese Data

December 19, 2017 at 16:34 by Andrew Moran

Copper futures are trading at their best levels since the end of November, buoyed by stronger economic data in China and heavy buying on Wall Street. The industrial metal is looking for additional gains to conclude its banner year.

March copper futures rose $0.005, or 0.15%, to $3.15 per pound at 15:19 GMT on Tuesday on the Comex division of the New York Mercantile Exchange. Copper prices have risen to three-week highs, and have advanced close to 25%, year-to-date.

The red metal is benefiting from two key factors: China and Wall Street.

Despite some hiccups in the national economy, China’s industrial production climbed more than 6% in November compared to the same period a year ago. This also beat analysts’ expectations. Moreover, Beijing’s refined copper output surged 10% last month to 786,000 tonnes, the highest increase in three years.

For now, the fundamentals in China could continue to be strong heading into the new year. Societe Generale analyst Robin Bhar told 9Finance:

Fundamentals are pretty strong on the back of the global economy and China. We may see some volatility over the new year and we may have to wait until after the Chinese New Year in February to see clear where China demand is going.

Copper has become one of the most attractive metals on Wall Street. In addition to the economic boost in the world’s second-largest economy, prices may start 2018 with a bang as the chances of supply disruptions and work stoppages in Chile have surged.

To kick off 2018, Chilean mine operators will initiate contract negotiations with 32 unions. Industry experts are already warning that it will not be easy, judging by the union demonstrations at the start of 2017. Chile is one of the world’s biggest copper exporters.

One of the biggest factors for copper next year may be government infrastructure spending. Despite pledges by the US, British, Canadian, Australian, and Chinese governments to spend billions of dollars on infrastructure, there have yet to be any official announcements.

If you have any questions and comments on the commodities today, use the form below to reply.

Leave a Reply