Perhaps the most disconcerting of the monthly index data involves copper, which has officially moved into a three-month downward price trend by falling 4 points to 89.
The copper complex pretty much fell across the board due to falling copper scrap prices, wire and primary cash prices in China, to 3-month LME copper prices off $500/ton from a month ago. Only Japanese primary cash copper prices and Korean copper strip posted gains, the first likely due to Japanese currency intervention largely to devalue the yen.
“Whenever we see copper prices dip – they reached a 22 month low in April – other factors tend to kick in, which tend to provide copper price support; scrap trading and China coming into the market to buy at the lows,” said Lisa Reisman, managing editor of MetalMiner.
“Scrap sellers stop selling, causing smelters to stop refining, while Chinese buyers come into the market, and that ends up lifting prices,” she said. June numbers will either break or define the three-month copper price trend (copper prices have fallen over the past two months).
But make no mistake about it: Caterpillar, a leading industrial bellwether, has reported less-than-stellar results for their first quarter. Mining appears to be in a slump and mining leads manufacturing, so the copper price trend remains the one to watch.
Key Price Drivers
After falling 7.8 percent, Chinese bright copper scrap finished the month at $6,815 per metric ton. On the LME, the primary copper cash price closed the month at $7,073 per metric ton after dropping 6.7 percent. Following a 6.7 percent decline, the copper 3-month price reached $7,105 per metric ton on the LME. The price of US copper producer grade 110 fell 4.5 percent over the past month to $3.85 per pound. The price of US copper producer grade 102 declined 4.3 percent over the month to $4.04 per pound. A 3.9 percent decline for Chinese copper wire left the price at CNY 52,360 ($8,490) per metric ton. A 3.2 percent decline for the cash price of Chinese copper left it at CNY 53,800 ($8,723) per metric ton.
Hovering around $10.26 per kilogram for the month, Korean copper strip remained unchanged.
The Copper MMI® collects and weights 12 global copper metal price points to provide a unique view into copper price trends over a 30-day period. For more information on the Copper MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.