It’s not just fears of U.S. inflation that have led to the recent fall of copper. A weaker demand from China is causing additional worries in the copper market. The world’s top consumer of copper and a producer of the red metal, China saw copper hit a remarkable high point last April, reaching $8,800. Soon afterwards, however, the volatility of the market took hold. China’s refined copper consumption turned from the high April outputs to drop 10.2 percent in May.
“You could argue that it’s surprising how well copper’s been doing given that Chinese thirst is so much less than it was,” ABN Amro analyst Nick Moore told Reuters about the Chinese data. This isn’t promising news, since the summer is already a slow time for copper demand.
When comparedÃ‚Â with April consumption, China consumed 45,801 fewer tons of refined copper last month. In a move that could hurt global prices but save their local market, Chinese copper smelters are requesting a tax-free tolling policy.
“Without the policy, smelters have been required to pay standard value-added tax on concentrate imports of 13 percent and an export tax on refined copper exports of 10 percent, charges that dramatically reduced China’s role in the international tolling industry,” one article explains.
It will be interesting to see how the copper market develops. But to keep up with metals trends, you’ll have to study more than the price of copper. If you’re a native-English speakerÃ‚Â sourcing copper from China, you may have to learn a new language: Your own.Ã‚Â Wired featured an article this Monday about the evolution of English, and a Chinese version of English is winning the vernacular battle of the future as English develops into an entirelyÃ‚Â different language. Wonder how you ask for cheap copper?