Low oil prices dragged down copper and other commodities as the year ended, according to Societe Generale SA and Citigroup Inc. With inventories ample and slowing economies eroding demand, cheaper oil lowers the price floor for mining companies and farmers to remain profitable.
Oil fell below $50 a barrel for the first time since April 2009 today. US crude’s front-month contract fell to $49.95, down 5% from Friday’s close, before recovering to $50.20 by 11:36 a.m. EDT
Brent crude for February also hit a fresh 5-year low, falling as low as $52.66 per barrel before rebounding back above $53.
The two crude oil benchmarks have now lost more than half of their value since mid-2014.
The week’s biggest mover on the weekly Copper MMI® was US copper producer grade 122 price, which saw a 1.9% decline to $3.54 per pound. This comes on the heels of a 0.8% increase the week before. The price of US copper producer grade 110 fell 1.9% to $3.54 per pound after rising 0.8% the week before. Following a 0.8% increase in the week prior, the price of US copper producer grade 102 fell 1.8% last week to $3.73 per pound. At KRW 9,640 ($8.80) per kilogram, the week finished with no movement for Korean copper strip. The Japanese copper cash price remained steady from the previous week at JPY 794,000 ($6,623) per metric ton.
Chinese copper prices were mixed for the week. The price of Chinese copper bar fell 0.3% to CNY 47,000 ($7,565) per metric ton after rising 0.1% the week before. Following a 0.1% increase in the week prior, the cash price of Chinese copper fell 0.3% last week to CNY 47,200 ($7,597) per metric ton. Prices for Chinese copper wire remained constant, closing the week at CNY 46,320 ($7,455) per metric ton. At CNY 40,400 ($6,502) per metric ton, the price of Chinese bright copper scrap did not change since the previous week.
With a 0.5% decrease on the LME, the 3-month price of copper closed the week at $6,289 per metric ton. Also on the LME, the cash price of primary copper traded sideways last week, hovering around $6,358 per metric ton.
The Copper MMI® collects and weights 12 global copper metal price points to provide a unique view into copper price trends. 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.