The copper price was hammered down on Tuesday as a rise in warehouse stocks convinced traders that end-demand in China has not materially improved despite Beijing’s economic stimulus.
In late New York trade July copper, the most active contract, fell 3.4% exchanging hands for $2.0450 a pound ($4,508 a tonne), more than wiping out Friday’s rebound and pushing the metal back into the red for 2016.
The latest leg down came as LME data showed more than 42,000 tonnes of copper arrived in warehouses – mostly Chinese smelter delivering into Singapore and Korea – just over the last two days.
Another indication that there is plenty of metal on offer was the collapse in spreads reports FastMarkets with cash buyers paying roughly the same as those wanting delivery in three months compared to a $25 discount last week.
On futures markets large-scale speculators like hedge funds have also taken a bearish position on the metal with net short positions – bets that the commodity can be bough at a cheaper price in the future – near record levels on the Comex market in New York.
For the rest of this article, click here: http://www.mining.com/copper-price-plummets-stocks-pile/