Copper Falters on Surplus Fears, Freeport Completes Deal to Export Indonesian Concentrate

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Copper prices slipped today as prospects of growing supplies overshadowed encouraging signs of health in the global economy, while zinc hovered at three-year highs on expectations of a tightening market, Reuters reported.

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Data earlier this month showed manufacturing in the world’s top metals user, China, expanded at its fastest clip in 18 months in July, while the US economy has gathered pace, with the outlook for its labor market brightening.

The copper market is expected to register another year of surplus this year, in a move that is seen weighing on prices. Late last week, the world’s top copper producer, Freeport-McMoRan, clinched a deal with the Indonesian government to allow the miner to resume copper concentrate exports.

The cash price of Japanese copper saw the biggest upwards shift for the day, rising 1.7 percent to close at JPY 763,000 ($7,498) per metric ton on Monday, July 28. The price of US copper producer grade 110 fell 0.8 percent to $3.92 per pound. The price of US copper producer grade 122 declined 0.8 percent to $3.92 per pound. The price of US copper producer grade 102 weakened by 0.7 percent, settling at $4.11 per pound.

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Chinese copper closed mixed yesterday. Following a couple days of improvement, the price of Chinese copper bar weakened by 0.5 percent. Prices closed at CNY 51,400 ($8,300) per metric ton. The cash price of Chinese copper changed direction with a 0.5 percent drop. After two days of improving prices, the metal finished at CNY 51,600 ($8,332) per metric ton. The price of Chinese copper wire continues hovering around CNY 50,790 ($8,201) per metric ton for the fifth day in a row. The price of Chinese bright copper scrap was unchanged at CNY 44,300 ($7,153) per metric ton.

On the LME, the 3-month price of copper gained 0.6 percent to finish at $7,180 per metric ton. At $7,183, the primary copper cash price finished the market day on the LME up 0.5 percent per metric ton.

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