New Coronavirus Outbreak in China Dampens Copper P
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Posted On: 02/02/2021 2:14:27 AM
New Coronavirus Outbreak in China Dampens Copper Prices
The prices of copper decreased on Friday, with many concerned that the rising numbers of coronavirus cases in China following a fresh outbreak would impact demand. The new outbreak comes ahead of the traditional Lunar New Year holiday, which sees industrial activity in the country slow down.
This comes after the copper smelting activity in the world increased in December 2020, led by China’s strong economy as well as its government’s stimulus efforts against the coronavirus pandemic.
On the London Metal Exchange, three-month copper declined to $7,970 per ton, aluminum dropped to $1,985.50 per ton while nickel fell to $18,075/ton. On the Shanghai Future Exchanges, zinc dropped to 19,995 yuan per ton ($3,083) while aluminum increased to 14,905 yuan per ton ($2,298).
Since the market recovery started in July, Europe’s business activity numbers have been extremely low, with many worried that the stimulus program of the incoming U.S. administration may be disappointing.
Analysts from ANZ noted that as the price of copper struggled to move higher and investors became more concerned about the new outbreak, China’s industrial activity became more restricted. This despite the fact that the country’s economic recovery was one of the bigger factors that had assisted the prices of copper to almost double in 2020.
Ole Hansen, an analyst from Saxo Bank, told Reuters that China’s Lunar New Year holiday and the United States’ and Europe’s slow progress in stamping out the virus has forced investors to re-evaluate copper’s short-term future.
In New York, investors seized the opportunity to make profits in copper stocks, which had traded well since the height of the pandemic. Decreases were led by KGHM, a leading company in silver and copper production. The Polish miner’s shares decreased by 4.5% while Antofagasta, a copper mining group based in Chile, closed with a 4% decline on the London Metal Exchange.
Additionally, Ivanhoe Mines, a Canadian mining firm that is currently building what could be the second-biggest copper mine in Congo, declined 4.5% before it made up some of those losses. Turquoise Hill, another mineral exploration and development company, also fell by over 3%. The company owns the Mongolian Oyu Tolgoi mine.
Quantum Minerals and Freeport McMoRan went against the trend and, after receding at the open, closed higher. The latter is currently the world’s largest producer of molybdenum and among the largest producers of copper while the former is a global mining company that produces nickel as well as copper.
Back in the United States, Josemaria Resources Corp. (TSX: JOSE) (OTCQB: JOSMF) is poised to reap full benefits from the projected surge in copper prices as the world gobbles up more of this conductive metal for use in various industries, such as in the electric vehicle industry and green energy. Josemaria plans to begin production at its property in Argentina in a couple of years.
NOTE TO INVESTORS: The latest news and updates relating to Josemaria Resources Inc. (TSX: JOSE) (OTC: JOSMF) are available in the company’s newsroom at https://ibn.fm/JOSMF
Please see full terms of use and disclaimers on the MiningNewsWire website applicable to all content provided by MNW, wherever published or re-published: https://www.MiningNewsWire.com/Disclaimer
The prices of copper decreased on Friday, with many concerned that the rising numbers of coronavirus cases in China following a fresh outbreak would impact demand. The new outbreak comes ahead of the traditional Lunar New Year holiday, which sees industrial activity in the country slow down.
This comes after the copper smelting activity in the world increased in December 2020, led by China’s strong economy as well as its government’s stimulus efforts against the coronavirus pandemic.
On the London Metal Exchange, three-month copper declined to $7,970 per ton, aluminum dropped to $1,985.50 per ton while nickel fell to $18,075/ton. On the Shanghai Future Exchanges, zinc dropped to 19,995 yuan per ton ($3,083) while aluminum increased to 14,905 yuan per ton ($2,298).
Since the market recovery started in July, Europe’s business activity numbers have been extremely low, with many worried that the stimulus program of the incoming U.S. administration may be disappointing.
Analysts from ANZ noted that as the price of copper struggled to move higher and investors became more concerned about the new outbreak, China’s industrial activity became more restricted. This despite the fact that the country’s economic recovery was one of the bigger factors that had assisted the prices of copper to almost double in 2020.
Ole Hansen, an analyst from Saxo Bank, told Reuters that China’s Lunar New Year holiday and the United States’ and Europe’s slow progress in stamping out the virus has forced investors to re-evaluate copper’s short-term future.
In New York, investors seized the opportunity to make profits in copper stocks, which had traded well since the height of the pandemic. Decreases were led by KGHM, a leading company in silver and copper production. The Polish miner’s shares decreased by 4.5% while Antofagasta, a copper mining group based in Chile, closed with a 4% decline on the London Metal Exchange.
Additionally, Ivanhoe Mines, a Canadian mining firm that is currently building what could be the second-biggest copper mine in Congo, declined 4.5% before it made up some of those losses. Turquoise Hill, another mineral exploration and development company, also fell by over 3%. The company owns the Mongolian Oyu Tolgoi mine.
Quantum Minerals and Freeport McMoRan went against the trend and, after receding at the open, closed higher. The latter is currently the world’s largest producer of molybdenum and among the largest producers of copper while the former is a global mining company that produces nickel as well as copper.
Back in the United States, Josemaria Resources Corp. (TSX: JOSE) (OTCQB: JOSMF) is poised to reap full benefits from the projected surge in copper prices as the world gobbles up more of this conductive metal for use in various industries, such as in the electric vehicle industry and green energy. Josemaria plans to begin production at its property in Argentina in a couple of years.
NOTE TO INVESTORS: The latest news and updates relating to Josemaria Resources Inc. (TSX: JOSE) (OTC: JOSMF) are available in the company’s newsroom at https://ibn.fm/JOSMF
Please see full terms of use and disclaimers on the MiningNewsWire website applicable to all content provided by MNW, wherever published or re-published: https://www.MiningNewsWire.com/Disclaimer
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